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The American Anti-Fraud Law

by Ursula Kampmann
translated by Annika Backe

January 8, 2015 – Collectors have a saying: everybody has fallen for a fake at least once, and those who maintain the contrary have not yet realized which of their coins are, in fact, fake.

The problem of numismatic forgeries is as old as the hills, but it has intensified in the previous years since coins have been counterfeit with the use of state-of-the-art technology in low-wage countries and distributed as forgeries via the internet. No law prohibits buying a forgery on such a site and – without expressly labelling it a forgery – reselling it afterwards. In nearly every country the courts are helpless in such a case. Counterfeiting demonetized coins is not illegal, nor is selling them. Only the fraud itself, hence offering counterfeit coins as genuine ones for sale, can result in criminal proceedings. Anyone pretending he doesn’t know what he is selling goes unpunished, generally speaking.

As of December 19, 2014, this does not hold true for the United States of America anymore. There, President Obama signed the Collectible Coin Protection Act. After a law has made the distribution and import of counterfeits legally relevant in 1973, this act now makes the sale of counterfeits illegal. Aggrieved parties can bring civil litigations against a dealer or a private person who has sold them a counterfeit coin deliberately, and can get the costs of acquisition back.

The place of residence of the defendant party is irrelevant. In the United States, it is also possible to bring a lawsuit against persons or companies which are located abroad. Apart from that, the new law provides a better protection for the brand. This makes it easier for grading companies to file a lawsuit when their brand name has been misused in order to upgrade counterfeits, i.e. offering the fraud in a counterfeit slab in the first place. It goes without saying that likewise companies who sell numismatic items under a brand can invoke this regulation.

Naturally, this law won’t put a quick end to the age-old problem of numismatic counterfeits. It is, however, a step in the right direction, i.e. improving the protection of the collectors. The best protection, though, is buying from dealers who guarantee the authenticity of their coins.

Here you find all details of the amendment passed by the Congress on December 19, 2014.

More information are provided by Coin Update.

CoinNews likewise reported on the amendment.

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