Hypothetical #9 - PCGS but Whizzed

MrEureka · June 20, 2005 3:21PM

Suppose you're an experienced collector. You buy a PCGS AU-58 1893-S Morgan from a big dealer's website at his full retail asking price. The coin is described as a perfect original toned borderline unc. When the coin arrives in the mail, you think it's undergraded so you crack it and resubmit it. This time, PCGS calls it whizzed. You show it around and the consensus is that the coin has been whizzed and retoned. At this point, it's three weeks after you bought the coin. You ask the dealer for a refund. Does he have to give you your money back?

mallard · June 20, 2005 3:21PM

NO!!!!!!!!!!!!!!!!!!!!!!!

solid · June 20, 2005 3:23PM

No, not since you cracked it...even though the coin itself hasn't changed, it's now
"damaged goods".

Ken

FC57Coins · June 20, 2005 3:24PM

<< Suppose you're an experienced collector. You buy a PCGS AU-58 1893-S Morgan from a big dealer's website at his full retail asking price. The coin is described as a perfect original toned borderline unc. When the coin arrives in the mail, you think it's undergraded so you crack it and resubmit it. This time, PCGS calls it whizzed. You show it around and the consensus is that the coin has been whizzed and retoned. At this point, it's three weeks after you bought the coin. You ask the dealer for a refund. Does he have to give you your money back? >>

Heck no!

You're taking a helluva chance cracking out expensive coins in the first place - you chose to do it, now you have to pay the consequences. There could've been other options like sending it in to have it re-evaluated. The owner wanted to make a score - well - he got burned instead.

Oldnewbie · June 20, 2005 3:26PM

You break it, you bought it.

UncleWiggly · June 20, 2005 3:27PM

Are you a stamp collector trying to get all of us to return to that hobby? With all these hypotheticals it just might work!!!

Jerry

wjd283 · June 20, 2005 3:30PM

Dang Mr Eureka,That's a lotta hypotheticals.Are you boning up,or just getting different opinions ?

On this one I'd talk to PCGS first.They should make it right through their grade guaranty.

michael · June 20, 2005 3:31PM

no

MrEureka · June 20, 2005 3:32PM

Are you boning up,or just getting different opinions ?

I'm working on a little project...

One more day of this and we're done, I promise!

Oldnewbie · June 20, 2005 3:33PM

<< On this one I'd talk to PCGS first.They should make it right through their grade guaranty. >>

It was cracked out.

jcping · June 20, 2005 3:35PM

You cracked it, you owned it

wjd283 · June 20, 2005 3:37PM

<< 

<< On this one I'd talk to PCGS first.They should make it right through their grade guaranty. >>

It was cracked out. >>

oops,missed that part.

<< I'm working on a little project... >>

<< One more day of this and we're done, I promise! >>

No problem,just curious.

dragon · June 20, 2005 4:04PM

No........and again as David Hall said, once it's cracked out, all bets are off.

WANNABEDEALER · June 20, 2005 4:12PM

if you thought it was undergraded, submit it in the holder, cause once you crack it you own it

PerryHall · June 20, 2005 5:46PM

This is pretty far fetched. The chances of PCGS not detecting a whizzed coin is virtually nil.

clackamas · June 20, 2005 6:04PM

"The coin is described as a perfect original toned borderline unc. When the coin arrives in the mail,"

These are the important aspects. The dealer MUST give you your money back. It is felony mail fraud if he/she does not.

relayer · June 20, 2005 6:25PM

No, because he already spent it

Trime · June 20, 2005 7:14PM

No requirement once the coin has been cracked out of the TPG holder. If still in the holder then obviously PCGS is responsible. I hope this is not the same dealer that sold the 1914-D cent nor the same crackout buyer.

construct · June 20, 2005 7:21PM

I cracked it because I not only agreed with my seller but also believed it was better than he said. When I cracked it I assumed the risk of the new grade. My seller has no further obligation to me, and it's my loss on this one.

Steve27 · June 20, 2005 9:00PM

"Does he have to give you your money back? "

Heck no, if you submitted it for upgrade in the slab then yes, but once you broke the slab open it became your liability.

Nic · June 20, 2005 9:17PM

No.

291fifth · June 20, 2005 9:30PM

NO. It isn't the same coin. When you buy a slab you are buying an item that comes complete with a set of guarantees. The moment the coin was cracked out the set of guarantees vanished. You can't return it to the dealer because what you bought from him doesn't exist anymore.

fivecents · June 20, 2005 9:32PM

Once you crack a coin......ALL BETS ARE OFF!!!!!

elwood · June 20, 2005 10:06PM

no

nwcs · June 20, 2005 10:13PM

As the man said, you break it you bought it.

DHeath · June 20, 2005 10:23PM

No. Once out of the holder, it's yours.

BillJones · June 20, 2005 10:39PM

I've already had this happen to me with a PCGS graded coin that was polished and retoned. The holder was badly scratched in an effort to hide the problem that PCGS had missed. I, being a newbie, dumb-ass dealer (this was 10 years ago), who had a limited amount of blind faith in PCGS, bought the coin and cracked it for a customer who wanted it raw. As soon as it was cracked I saw right away that this was a misgraded problem coin.

After a heated discussion I sold the thing back to the dealer at a $100 loss and chalked it up to "education expense." This dealer is one of the biggies in the business, and as far as I’m concerned his ethics are in the toilet. I will not waste my time at his table ever again under any circumstances. He knew what was wrong with the coin and played games with it.

Longacre · June 20, 2005 10:50PM

No becuase you cracked it out. The dealer has no obligation at that point.

BillJones · June 20, 2005 11:07PM

Here's the trouble with the, “It's been cracked out of the holder, therefore it's yours,” carved in stone opinion.

In the case that I cited above it was impossible to tell that coin had been polished and retoned given the condition of the holder. The coin was an early quarter that had been graded VF-30. From you could see, the “meat” (detail) was there for the grade, but the holder was scratched in such a way that it knocked down the shine from the polishing. In short it would have been impossible to have seen the problem in the holder and to have sent the coin back to PCGS for an adjustment.

The primary fault here lies with PCGS because they blew the grade. The secondary fault lies with the dealer who tampered with the slab in order to put one over on a prospective buyer. After the deed had been done, it would have been very difficult to have gotten PCGS to honor its commitment because spotting the damage was nearly impossible.

So is it OK for PCGS to walk away from its comment to stand behind the grade when they missed it by a mile? Is it ethical for a dealer to hide the problem in the coin by scratching up the holder? I put that question to you.

ziggy29 · June 20, 2005 11:13PM

Nope. You should have shown it around while it was still in the plastic. If you do that, you may have some recourse with the dealer, and almost certainly with the TPG. But once you crack it out, too bad -- so sad.

construct · June 20, 2005 11:16PM

Bill, I agree that monkeying with the holder to hide the problem was clearly unethical. However, that detail wasn't in the hypo. If it were, I might have given a different answer. My answer was based on a reasonably clean holder.

ritepath · June 20, 2005 11:19PM

no stuppie, you should have left well enough alone.

ziggy29 · June 20, 2005 11:19PM

<< In the case that I cited above it was impossible to tell that coin had been polished and retoned given the condition of the holder. The coin was an early quarter that had been graded VF-30. From you could see, the “meat” (detail) was there for the grade, but the holder was scratched in such a way that it knocked down the shine from the polishing. In short it would have been impossible to have seen the problem in the holder and to have sent the coin back to PCGS for an adjustment. >>

Fair enough. In this case, though, if a new holder would have allowed the whizzing to become evident, then perhaps the appropriate thing would have been for a reholdering of the coin, sent to PCGS in its original slab.

Then, either the coin returns to you in a holder where you can see the whizzing and take action, or perhaps PCGS notices the whizzing on the reholdering/regrading and has to make good on the guarantee (painful for a '93-S Morgan).

RYK · June 20, 2005 11:21PM

No, once you crack the holder you have altered the coin (at least it's marketability), and you have voided any possible return option.

CarlWohlforth · June 20, 2005 11:24PM

I put the clause "returned coins must be in the original holder" in my auctions. While PCGS guarantees the label is accurate for coins in their holders I can guarantee that PCGS is %100 consistent with every raw coin.

OffMetal · June 20, 2005 11:29PM

<< As the man said, you break it you bought it. >>

If the coin was still in the slab, then the dealer would have to give you your money back.
But then you cracked the slab out of it's original holder, then it's not the dealer's problem anymore.

Ben

ddink · June 20, 2005 11:40PM

<< No........and again as David Hall said, once it's cracked out, all bets are off. >>

HRH has said repeatedly that PCGS coins are cracked before entering the grading room so that the graders aren't biased. If you don't trust PCGS to be without bias, and you crack it, you're screwed.

ddink · June 20, 2005 11:41PM

<< full retail asking price. The coin is described as a perfect original toned borderline unc. When the coin arrives in the mail, you think it's undergraded so you crack it and resubmit it. This time, PCGS calls it whizzed. You show it around and the consensus is that the coin has been whizzed and retoned >>

P.S. Who would "show it around" for opinions AFTER they submit it rather than BEFORE? IMO they deserve what they get.

Julian · June 20, 2005 11:44PM

I would think not, since the coin is not the way it was sold.

Shamika · June 21, 2005 12:00AM

<< Does he have to give you your money back? >>

In my dreams!

csw · June 21, 2005 12:38AM

I would opine that technically you may have a cause of action against both the dealer and PCGS, but good luck proving that the coin you bought is the same one you cracked out and submitted.

csw · June 21, 2005 12:43AM

I would opine that technically you may have a cause of action against both the dealer and PCGS, but good luck proving that the coin you bought is the same one you cracked out and submitted.

mgoodm3 · June 21, 2005 1:00AM

You're hosed, shouldn't have cracked it out.

morgannut2 · June 21, 2005 1:08AM

I had this happen with an NGC MS-63 Morgan 1892CC. Both PCGS and later NGC claimed it was lightly thumbed. Basically I learned the TPG's are not very dependable indicators of quality and buy accordingly.

PerryHall · June 21, 2005 2:04AM

When you sell a top tier slab, you are not only selling a coin but you are also selling a guarantee. When you crack out a coin you are destroying the guarantee. I don't understand why any dealer would feel obligated to take any coin back that's been cracked out except to maintain customer goodwill.

prooflike · June 21, 2005 2:32AM

Absolutely not, once cracked, the item is in a materially different condition.

mozin · June 21, 2005 4:55AM

You cracked it so the value is gone. No refund.

mercurydimeguy · June 21, 2005 5:18AM

Andy,

Having gotten to know you a bit better recently, I sense the "ta da" that's coming at the end of this "research project".

In a Fruedian like fashion I will answer the question with another question....

----Why was it slabbed by PCGS in the first place?

A whizzed coin is a whizzed coin! It doesn't get whizzed after it got in to the holder. When a dealer sells a slabbed coin he is selling someone's opinion on that coin on any given date/time when that coin was first graded. The dealer should not be held responsible. The culprit here is the TPG.

Forget about cracking the coin and sending in for upgrade. When a person buys a coin slabbed by the "suposedly" top tier grading service with that purchase comes a lifetime implied warranty....even if it is unstated. The implication is that the coin is genuine and grades somewhere close to the stated grade. If a collector wants to collect the coins raw, but doesn't know how to grade, he/she can buy a slabbed coin...graded as an AU58 by a top tier TPG and is lead to believe that it is. If he she cracks it out to only find out several years later that it is not, the blame is with the TPG.

And I disagree with whoever stated that once cracked out the coin materially changes -- that's Dung!

--You buy a diamond ring certified as XXX and loose the certificate...you later sell the diamond ring to someone who goes and gets it re-certified and it grades as YYY...the first certification service should be held accountable.

--You own a jewelry store (XYZ, Inc.) and buy a chain that is stamped 14k from a certified Gold company. You sell it to a customer. That person wears it for 10 years and the 14k wears off. They don't like the chain anymore and go to a different jeweler to sell it/trade it in. The jeweler does the gold test and tells the person it's 10k and not 14k. Is it XYZ, Inc.'s fault? No! They were mearly selling the opinion of someone in a common-law accepted position of authority.

So back to my first answer/question -- why was it slabbed in the first place?

EDITED TO ADD: Off topic, but I just gave a (not "the" but "a") reason why the grading standards all of a sudden changed this year. The bigger you get, the more visible you become. The more visible you become the more scrutiny you draw. The more scrutiny you draw, the greater the likelihood that a itigious person or firm will try to test your (what they perceive to be a) common-law accepted position of credibility, even to the extent of implying that by de facto (and they would hope soon to be de jura) your opinions are legally binding. A CPA is "certified" and hence has professional liability, and so do others that claim the word "certified."

MrEureka · June 21, 2005 9:39PM

The coin is described as a perfect original toned borderline unc.

This was a clear misrepresentation. However, remember that the buyer is an experienced collector. He would not have relied on that misrepresentation, so he has no claim against the dealer.

CalGold · June 22, 2005 7:00AM

Collector should have submitted it for regrade in the holder where the grading guarantee would have remained valid.

CG

Hypothetical #9 - PCGS but Whizzed

Comments

Leave a Comment