January 2, 2009, Newsletter Issue #151: Four Ways To Avoid An Unscrupulous Coin Purchase

Tip of the Week

In the world of coin collecting, you’re bound to come across a situation where you’re not sure if you should walk away from a coin purchase or not. If you want to avoid making an unscrupulous coin purchase, read on.

1. You’ve heard it before, but if something sounds too good to be true, it probably is. Searching for that perfect bargain while you’re coin collecting might let your emotions get the best of you, but coins selling far below market value are often either scams or an error in printing.
2. Don’t fall for a guarantee of a performance percentage. You might find an unscrupulous ad guaranteeing you a performance percentage of 25 percent a year. Although it is a grey area, most leaders in the coin collecting industry agree the Securities Exchange Commission finds a guarantee of a performance percentage to be illegal.
3. If you conduct a transaction with a coin dealer who knowingly omits a major error in a coin, it’s safe to say you should not deal with that coin dealer again. A dealer who offers a refund or recourse for an error should be considered an ethical dealer.
4. A coin dealer offering a coin for sale that isn’t in stock is actually a common practice and shouldn’t concern you. The coin dealer is often in the process of locating the coin for you. However, if a coin dealer lists five different grades of the same type of coin, but only has one and tries to pass off the same coin to you when you return and decide to upgrade, you should seek a refund and a new coin dealer.

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