Gold Coin Counterfeiting today

Discussion of the Gold portion of the Permanent Portfolio

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I Shrugged
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Gold Coin Counterfeiting today

Post by I Shrugged » Tue Dec 20, 2016 9:19 am

It's been a while since this has been discussed here. What is the current state of affairs?

I'm especially curious which coins are most counterfeited, and which are not. I would think coins of partial-ounce size would not be.
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Re: Gold Coin Counterfeiting today

Post by curlew » Tue Dec 20, 2016 3:55 pm

Shortly after I bought the Gold Coin Balance to test my Golden Eagles, they withdrew their guarantee after someone sent them a passable fake. They still sell the balance but don't guarantee Eagles or Kruggerands any more. Here is the write-up on their website.....

https://goldcoinbalance.com/fake-tungsten-gold-coins
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Re: Gold Coin Counterfeiting today

Post by I Shrugged » Tue Dec 20, 2016 7:44 pm

Hmmm, I wonder if they did the ring (sound) test on it. It seems like passing the balance and sizing is only halfway there.
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Re: Gold Coin Counterfeiting today

Post by curlew » Wed Dec 21, 2016 10:02 am

I Shrugged wrote:Hmmm, I wonder if they did the ring (sound) test on it. It seems like passing the balance and sizing is only halfway there.
The fact that they could tell it was fake means the coin must have failed some other kind of test. They didn't say what it was but it could have been something as simple as a visual inspection. I've read that it's very hard to make a perfect looking Eagle from tungsten though the counterfeiters will probably get better at it as time goes on.

I haven't bought any coins in a long time but next time I might go with something beside Eagles or Kruggerands.
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Re: Gold Coin Counterfeiting today

Post by dragoncar » Wed Dec 21, 2016 3:40 pm

It could have been destructive or uneconomical testing, though
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Re: Gold Coin Counterfeiting today

Post by curlew » Wed Dec 21, 2016 4:06 pm

dragoncar wrote:It could have been destructive or uneconomical testing, though
Re-reading the page at the URL for the Gold Balance that I originally posted I see that the person who sent in the coin became suspicious because of visual characteristics. To verify, it appears someone cut into it to reveal the tungsten underneath as shown in the photo, something you obviously don't want to do a good coin.

They also say in the article that they will be coming out with a new product for testing but it's been several years so apparently it isn't as easy as they thought.
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Re: Gold Coin Counterfeiting today

Post by I Shrugged » Thu Dec 22, 2016 10:30 am

These people also make physical and sound testers. Expensive, but if they work...
https://www.thefisch.com/

And there is a phone app for PM coin sound testing that looks pretty cool.
https://www.youtube.com/watch?v=HdcKEeKJb5U
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Re: Gold Coin Counterfeiting today

Post by Lonestar » Sun Jan 01, 2017 1:48 pm

I have started paying the small premium to purchase current year uncirculated gold Eagles. The dealer I buy from is an authorized U.S. Mint dealer. I am assuming this might offer some protection against getting a counterfeit coin.
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Re: Gold Coin Counterfeiting today

Post by dualstow » Tue Jan 10, 2017 7:47 am

Saw this today, though it's from August '16.

Gold Is Hot This Year. So Are Fakes
With this year’s surge in gold prices, many coin dealers are seeing a jump in forgeries; technology is making them harder to detect and easier to peddle

-- WSJ

on.wsj.com/2b0ZmBr

{hopefully the whole thread won't be diverted to getting around the paywall. You can do it, guys!}
RIP Marcello Gandini
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Re: Gold Coin Counterfeiting today

Post by I Shrugged » Tue Jan 10, 2017 9:39 am

I tried the usual way to get around the paywall, a google search of the title, but I still hit the paywall.

Here is an NBC News story that came up, though:
http://www.nbcnews.com/business/busines ... et-n591201
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Re: Gold Coin Counterfeiting today

Post by ochotona » Tue Jan 10, 2017 9:42 am

Oh shoot, I was going to start buying Eagles. I'm going to stick to Maple Leaves and Kangaroos.
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Re: Gold Coin Counterfeiting today

Post by dualstow » Tue Jan 10, 2017 12:50 pm

I Shrugged wrote:I tried the usual way to get around the paywall, a google search of the title, but I still hit the paywall.

Here is an NBC News story that came up, though:
http://www.nbcnews.com/business/busines ... et-n591201
Hmm. It mentions improved technology, tungsten cores, lack of regulation in China, the usual stuff. An iphone app for the ring test. (I see the Fisch ringer is $89 USD. I might try the app first). Says that bad dealers are still more of an issue than fakes in one expert's opinion.

It does not mention everything the NBC article does, like the bogus bar codes and registration numbers.

What I really wanted to show you was this graphic. Maybe it's accessible through this naughty deeplink: (Edit: Nope. Darn).
RIP Marcello Gandini
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Re: Gold Coin Counterfeiting today

Post by dualstow » Tue Jan 10, 2017 12:52 pm

I'm not worried about future gold purchases because I'll have a testing tool ready, but I shudder to think the random year krugs I already have at the bank could be fake. Hope not. :-\
RIP Marcello Gandini
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Re: Gold Coin Counterfeiting today

Post by PP67 » Tue Jan 10, 2017 12:58 pm

dualstow, can you print the WSJ article to a pdf file and then post the pdf here?
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I Shrugged
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Re: Gold Coin Counterfeiting today

Post by I Shrugged » Tue Jan 10, 2017 3:11 pm

This could have the effect of depressing demand for gold coins. Or so I would think.
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Re: Gold Coin Counterfeiting today

Post by drumminj » Tue Jan 10, 2017 5:47 pm

I Shrugged wrote:This could have the effect of depressing demand for gold coins. Or so I would think.
So now we should buy paper gold instead of physical??? :o
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Re: Gold Coin Counterfeiting today

Post by I Shrugged » Tue Jan 10, 2017 6:48 pm

No, but if gold coins become disreputable, something's gotta give.
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Re: Gold Coin Counterfeiting today

Post by ochotona » Wed Jan 11, 2017 5:25 am

The market is not dead yet. The 99.99% coins can't be counterfeited due to the density of gold. The lower gold content of Eagles and Krugerrands makes them vulnerable.
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Re: Gold Coin Counterfeiting today

Post by Libertarian666 » Thu Jan 12, 2017 12:32 pm

ochotona wrote:The market is not dead yet. The 99.99% coins can't be counterfeited due to the density of gold. The lower gold content of Eagles and Krugerrands makes them vulnerable.
Tungsten is almost identical in density to gold, so even 24k coins might be a problem.

But the ring test will still distinguish fake from real coins.
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Re: Gold Coin Counterfeiting today

Post by Steve Brule » Thu Jan 12, 2017 6:50 pm

dualstow wrote:I'm not worried about future gold purchases because I'll have a testing tool ready, but I shudder to think the random year krugs I already have at the bank could be fake. Hope not. :-\
If you are really concerned, there are more and more gold dealers that have x-ray frequency machines that can determine the content of your krugerrands. In my experience, the dealers with these machines have been happy to let me test my coins with them.
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Re: Gold Coin Counterfeiting today

Post by dualstow » Thu Jan 12, 2017 8:09 pm

Interesting. I haven't seen the x-ray tests, but that would get right to the point, wouldn't it? I'll have to see if I can find one locally.
I think I'll try the iphone app, and if necessary, the Fisch ringer (89 bucks) in the future.
RIP Marcello Gandini
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Re: Gold Coin Counterfeiting today

Post by ochotona » Thu Jan 12, 2017 10:36 pm

Gosh, would that be x-ray diffraction (XRD) analysis? I used to do that in college with minerals. That's a serious solution to the security problem.

I have Maple Leaf coins with the micro-engraving on the leaf side, it's really intricate and not possible to see in full detail without magnification. You'd think this would be impossible to forge well.
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Re: Gold Coin Counterfeiting today

Post by dualstow » Fri Jan 13, 2017 8:14 am

I bought my first maple this winter, a 2017 with that microengraving. Pretty cool. I'd buy more if they weren't so soft (pure). Price of being pretty.
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Re: Gold Coin Counterfeiting today

Post by Cortopassi » Fri Jan 13, 2017 8:34 am

I understand there is a potential for concern here, but it sounds a bit overblown. I buy from a guy who's been in business for 35+ years. I'm not too worried.

If a fake was good enough to pass by him to me, well, then it's probably good enough for me to pass on if there comes a time to sell! I will hopefully never know.
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Re: Gold Coin Counterfeiting today

Post by sophie » Fri Jan 13, 2017 8:35 am

I'd heard maples were beautiful. I'd be worried about how they'd hold up during long term storage by a cretin like me, though.

I think I'm done buying physical gold, and this thread has helped with that decision - I just don't need to be worrying about counterfeiting, let alone storage & insurance issues. The rest of my taxable gold purchases will be Perth Mint certificates.

BTW Fidelity's bullion program is really worth a look for tax-advantaged accounts. They've reduced the storage fees. There are ~2% commissions to buy & sell, and storage (i.e. expense ratio) is 0.5/yr. Storage is in Nova Scotia and insured by Lloyd's of London. It's limited to IRAs, can't do it in a Keogh, but it's a really nice alternative to ETFs. I am thinking to take the plunge for the gold held in my Roth.
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