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"Overgrading can be criminal" says a U. S. Court
There is an interesting article in the latest (June 15) issue of Numismatic
News. The U. S. Second Circuit Court of Appeals upheld the conviction of a coin dealer who was charged and convicted of mail fraud when he sent customers many coins that were overgraded. The Court said that systematic overgrading could be grounds for mail fraud since the value of the coins is determined by the grade. The defendants had made the usual claims that grading is subjective, there is no industry standard, yada, yada.. more than 700 coins were admitted into evidence and reviewed by an independent coin grader (Paul Montgomery of PCGS). Of those coins, 67 were assigned the same grade as determined by the defendants but the remainder were assigned a lower grade sometimes many points lower or were deemed problem coins and not gradeable. The court noted that if grading was as subjective and inconsistent as teh defendants claimed, then at least some fo teh coins should ahve received a higher grade that that assigned by the defendants. None did. The court then upheld the conviction. This is a victory for the good guys. -- Richard A thought: Life is not a journey to the grave with the intention of arriving safely in a pretty and well preserved body. But rather it's to skid in broadside, thoroughly used up, totally worn out, and loudly proclaiming, "Wow! What a ride!!!" |
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"Richard L. Hall" wrote:
(snip) This is a victory for the good guys. Filed under 'Be Careful What You Ask For'. Alan 'has his own filing system' |
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On Mon, 14 Jun 2004 15:27:20 GMT, "Richard L. Hall" wrote:
There is an interesting article in the latest (June 15) issue of Numismatic News. The U. S. Second Circuit Court of Appeals upheld the conviction of a coin dealer who was charged and convicted of mail fraud when he sent customers many coins that were overgraded. The Court said that systematic overgrading could be grounds for mail fraud since the value of the coins is determined by the grade. The defendants had made the usual claims that grading is subjective, there is no industry standard, yada, yada.. more than 700 coins were admitted into evidence and reviewed by an independent coin grader (Paul Montgomery of PCGS). Of those coins, 67 were assigned the same grade as determined by the defendants but the remainder were assigned a lower grade sometimes many points lower or were deemed problem coins and not gradeable. The court noted that if grading was as subjective and inconsistent as teh defendants claimed, then at least some fo teh coins should ahve received a higher grade that that assigned by the defendants. None did. The court then upheld the conviction. This is a victory for the good guys. This was discussed last week here, as well as on the PCGS boards. Here is the actual decision from the second court of appeals: http://www.k6az.com/forums/031141p.pdf This isn't the first time a court has attached criminal liability for systematically overgrading coins: http://www.k6az.com/forums/us_vs_kayne.htm And there is a third case where a husband and wife (last name DiAngeles I believe) have been charged with several federal counts in Florida relating the 21st Century "grading service". This was reported in Coin World a few weeks ago. -- K6AZ WEB PAGES http://www.k6az.com/web_pages.htm |
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