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Counterfeit gold coins fool buyers

Dont Waste Your Money
Counterfeit gold coins fool buyers
Posted at 10:31 AM, Jun 09, 2016
and last updated 2016-06-09 12:31:36-04

 

The price of gold is heading up again in 2016, as investors worry about the safety of the stock market. As a result, you may be noticing more radio commercials and online ads for gold coins.

But before you invest, coin experts are warning you to beware counterfeits that are flooding the market right now.

Counterfeits Showing up Everywhere

Coin shop owner Brad Karoleff now spends a lot of his time  checking for counterfeits.

In one hand, he held up a one ounce US Eagle gold coin, worth over a thousand dollars. In the other: an identical looking Chinese knockoff, worth maybe a dollar.

"Some off them are getting pretty good," Karoleff said. "They will fool the average person, and, worse, even some professionals have been fooled."

Can't Spot the Difference

Many collectors --who order these coins online, or buy them on eBay or at flea markets -- are unable to tell the difference.

One burned investor who came into the shop, but did not want to give his name, said "I was tricked, it looked real to me."

Karoleff says he is seeing this more and more. "The problem is you will invest $1,200 or $1,300 in a worthless piece of metal."  he said.    

The American Numismatic Association says counterfeit silver coins and fake one ounce gold bars are flooding the US market this year.

Worse, coin dealers say some of these new reproductions are so good, they weigh almost as much as the real gold coin. So weighing them on a scale may not catch that they are counterfeit.

Even the packaging is identical.

What Can You Do?

Karoleff says the only way to tell is to do a scratch or acid test, which in the case of one coin he has, found dull gray lead underneath.

Mist important, though, he says, is to deal with a reputable seller.

"You need to deal with someone who is reliable, who has been in the business, who knows what the difference between counterfeit and real is, and who will stand behind what they sell you," Karoleff said.

Bottom line: do your research before paying hundreds of dollars for any "rare" gold or silver piece, or that coin may be worth less than the cost of a game token at the nearest Check E Cheese pizza parlor.

And that way you don't waste your money.

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