The Great U.S. Mint Silver Coin Swindle - and a "delamination inspection machine"-By Tom DeLorey
1630Boston
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By Tom DeLorey,
.
During testimony before a House Subcommittee on Appropriations on February 27, 1968, Mint Director Eva Adams said “During 1967 the Mint was assigned an additional task resulting from the decision to recall circulating coins from the Federal Reserve System in order that silver Dimes and Quarters could be held as reserve inventories for emergency situations. The Mint will separate the mixed lots of subsidiary coins returned, retaining the silver coins.”
Eva Adams watches a coin sorting machine pull out silver coins. Image 
Image Credit: Numismatic Scrapbook Magazine / Coin World. Used with Permission.
Elsewhere in the testimony it is revealed that the separation was accomplished using a “delamination inspection machine” built by American Machine & Foundry. Thirteen prototypes of this machine had been authorized in June of 1967 “to replace the present manual-vision reviewing” system. I believe that this new machine was originally intended for the Fourth Philadelphia Mint then under construction, which finally opened in 1969. I assume that eventually all of the Mints would have used them.
I could not find any details anywhere on what this machine was or how it operated. My best guess, based upon the name, is that it was originally intended to find and segregate CN-clad planchets that had had one or both cladding layers split off, or de-laminate, prior to being struck. It was expected to ultimately test up to 50 planchets per second, and the best way I can think of it doing that would be by weight. A clad layer constituted one-sixth of the thickness of a planchet, and so a de-laminated planchet would be 16.67% underweight.
When sorting silver and clad coins, just set your desired weight at that of the silver coins, and the clad coins–which are slightly over 9% lighter–will go into the reject bin. Return those to circulation and keep the silver ones. A few “slick” silver coins, coins worn almost smooth (which typically average about 7% lighter), might have gone into the reject bin as well, but perfection was not the object and the Mint had a LOT of coins to sort.
The high volume of coins eventually sorted by the Mint was made possible by a little trick at the Federal Reserve Banks.
Starting at that unrecorded date in 1967, the FRBs stopped automatically recycling the dimes and quarters received by it from member banks and started warehousing them. Between December 1966 and June 1968 the total face value of all coins held by Federal Rerserve Banks rose from $277.5 million to $413.5 million, presumably much of it as mixed silver and clad batches awaiting sorting.
During this **secret diversionary program **the commercial demand for dimes and quarters was met almost exclusively with clad coins struck during those huge mintages of 1965, 1966 and 1967-dated coins. There are references to some mixed batches of clad and silver coins being intentionally re-released when commercial demand temporarily outstripped the supply of new clad coins, but there are indications that the banks sampled the silver content of incoming batches, which would have enabled them to re-release those with the highest percentages of clad coins.
Read the full interesting article here if interested - https://coinweek.com/bullion-report/the-great-silver-coin-swindle/
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Comments
Th anks, interesting articles.
Jim
When a man who is honestly mistaken hears the truth, he will either quit being mistaken or cease to be honest....Abraham Lincoln
Patriotism is supporting your country all the time, and your government when it deserves it.....Mark Twain
Thanks for the information/link. That is one huge quantity of coins that had to be sorted. Cheers, RickO
"Starting at that unrecorded date in 1967, the FRBs stopped automatically recycling the dimes and quarters received by it from member banks and started warehousing them. Between December 1966 and June 1968 the total face value of all coins held by Federal Rerserve Banks rose from $277.5 million to $413.5 million, presumably much of it as mixed silver and clad batches awaiting sorting."
That's about the time that The Government accused coin collectors of hoarding small change.
Great article. Great share!
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super neat, thanks for posting!
No wonder all the silver seemingly dried up over night. In the middle of a coin shortage, taking coins from circulation was really counter productive.
But then again, the Mint probably figured that it would be much better if it caught the Silver for itself, rather than let it get into the hands of the minions.
Pete
Here's a post from 2020 with some additional details:
https://forums.collectors.com/discussion/1037320/anybody-know-about-the-treasury-sorting-silver-coins-out-of-circulation-back-in-the-late-60s
My Adolph A. Weinman signature
Thanks for the link @Overdate
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Thank you.
Yes @CaptHenway
That was one of your great articles, I had to post it here for those that had not seen it.
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No problem, though a brief mention of the authorship without having to go to the link would be appreciated.
TD
Thanks, Boston. Another excellent post.
Edited the OP to justly give credit to the author of the fantastic article, Tom DeLorey
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There may have even been people who believed LBJ's vomit of 'the silver coins will circulate beside the new clad-slugs-that we will now produce. FUBAR!!
Thanks!
For everyone else here..........I neglected to give credit for that wonderful numismatic article to @CaptHenway
Successful transactions with : MICHAELDIXON, Manorcourtman, Bochiman, bolivarshagnasty, AUandAG, onlyroosies, chumley, Weiss, jdimmick, BAJJERFAN, gene1978, TJM965, Smittys, GRANDAM, JTHawaii, mainejoe, softparade, derryb, Ricko
Bad transactions with : nobody to date