Nearly $5 million has now been recovered for unwitting buyers of overpriced coins through the intervention of the Numismatic Consumer Alliance, Inc. (NCA), according to John Albanese, founder and president of the not-for-profit watchdog organization.
That comes to an average of close to $1 million per year since NCA became operational in 2005.
More than $735,000 has been recovered in the 19 most recent cases, Albanese said, with the largest single case involving $130,000. As in the past, he said, disproportionate numbers of victims were elderly individuals who had purchased coins priced well above their true market level from telemarketers who touted them as good investments.
“It’s very disturbing,” Albanese said, “to see the way unscrupulous sellers prey upon older Americans – people who are living on limited incomes and can ill afford to waste their money on scams, especially during these difficult times. These con artists convince older people to sink their life savings into high-mintage modern coins and other so-called investments that are really just numismatic junk.
“We’ve looked into cases where the coins were worth as little as one-tenth what people paid for them, and that’s simply unconscionable.”
Albanese said the elderly victims, in particular, not only had little or no knowledge about coins, but also lacked the Internet savvy to check out what they were buying and who they were buying it from.
The New Jersey-based Alliance intervenes on such buyers’ behalf, engaging legal and other professional assistance if necessary, in an effort to counteract and discourage flagrant abuses in coin-related transactions.
Scott A. Travers, author of The Coin Collector’s Survival Manual and a prominent consumer advocate, serves as NCA’s executive mediator.
“The value of NCA is incalculable,” Travers said, “because of its power and influence in mediating and successfully resolving disputes.”
Travers works closely with judges, attorneys and other professionals chosen for their expertise in mediating and arbitrating disputes, providing them with guidance on numismatic issues as they review cases submitted to them for review.
He sees this role as an extension of his consumer advocacy efforts in authoring the Survival Manual and other important numismatic books which strive to elevate awareness of the perils and pitfalls of buying and selling collectible coins.
“NCA deserves credit for being in the forefront of resolving the serious problems that arise from time to time in this industry,” Travers said.
NCA seeks no compensation when it enters a case on behalf of an aggrieved consumer – even though it frequently incurs substantial legal bills and other expenses in the process. The funds to cover such costs are contributed by coin dealers and others who share its concern about fraud and deception by disreputable coin sellers and the harmful effects these practices can have on the marketplace as a whole.
Cases involving potential abuses are referred to NCA by a number of sources, including hobby organizations, numismatic periodicals, law enforcement agencies, reputable coin dealers, and victims’ families and friends.
Upon learning of such cases, Albanese said, NCA contacts the consumers to determine the validity of their claims and asks for copies of all pertinent paperwork. If it concludes that the buyers were scammed, it contacts the sellers and urges them to make restitution in order to avoid legal action.
Albanese said about 80 percent of the cases are resolved through negotiations between NCA and the sellers. The other 20 percent can be far more difficult and costly to resolve, he said.
In the vast majority of cases, Albanese said, the misrepresented coins encountered by NCA are housed in holders from “fringe grading services” bearing grades substantially higher than accepted market levels. Problems have been particularly serious, he said, with coins encapsulated by the National Numismatic Certification, LLC, and the Numismatic Trust Corp.
The Alliance has intensified its scrutiny of such grading services, Albanese said, and also has been developing plans for new educational programs aimed at alerting the public to the dangers posed by misrepresented coins.
Further information about NCA is available at its Web site, www.stopcoinfraud.org.