what you've just heard is the biggest
threat to gold and silver investing ever
that was a US silver eagle legal tender
coin that is counterfeit made in China
and I've got with me James Anderson to
tell us more about them he's been
monitoring this the rise of all of these
counterfeit gold and silver products for
quite some time thanks Mike
yeah so so that was a counterfeit silver
eagle they are coming out of China and
there's a good threat of counterfeits
coming from there
this year alone there's been multiple
reports of counterfeit product in March
of this year there was a counterfeit
gold bar that was found in the UK that
had tungsten rods in it and as well
recently in September there was a fake
Credit Suisse gold bar that was found
with tungsten in it and so there was
multiple other bars that were found
after that report broke in September in
New York so it's not just gold bars
though I think the investing public
doesn't realize that there are very good
silver counterfeits out there as well
yeah one thing I'd like to say right up
front here is that we've been monitoring
this for quite a while and we've taken
steps to ensure that our customers are
getting authentic gold and silver coins
we either buy directly from the US Mint
or directly from refineries so when
you're buying product from us it's it's
most likely new product any product that
we take back from customers gets assayed
now before it goes into our inventory so
we absolutely guarantee that your gold
and silver is authentic it's what it is
represented to be so can you repeat this
test and show them the difference
between a real silver eagle and the
counterfeit so let's take a real silver
eagle Network so here's a ping test of a
real one
okay and now the counterfeit much higher
pitch and much less sustained it doesn't
ring for as long a time we're going to
be putting the frequencies that the
notes of these rings on our website that
is the simplest test that you can do but
we have been making investments in
making sure that none of the counterfeit
product gets into our system and so what
kind of measures have we taken so far so
there's basically two types of
counterfeit product out there there's
really a plated type which is what this
fake silver eagle is is a plating really
the the actual content of this is about
eighty-five percent copper fourteen
percent nickel a little bit of silver on
the outside but it's mostly base metal
but so it's actually worth just probably
less than a dime correct
all right or well it's larger than
Pennington some are fifteen cents
whatever exactly so it's not worth much
as far as the melt of it and so plating
is one way that's being used and as well
for gold hollowing out of bars is being
used as well and I'm sure silver is
getting done as well but usually that's
the larger bar so there's kind of a few
methodologies that were using
proprietary methodologies that deal with
x-ray and then as well as sound so those
are the two methodologies depending on
which products we're dealing with with
other measures as well we're making sure
the product that comes to our customer
is authentic and our guarantee is
bonafide okay there are those threats in
every in every size product so the
argument that you should buy only small
size product and that there's no
counterfeits of small size products is
is not really going to hold water not
only more not right well that was my
argument for many years I have to
backpedal now and
you know one of the things for investing
develop a plan stick with it but always
be willing to change the plan if the
situation changes the fundamentals and
what there's a big situation change your
fundamental change up until just this
past year or so you didn't have to worry
about buying a US silver eagle now you
do yeah so let's run down the list here
and and tell them what's been going on
you've been monitoring this very closely
for some time and you've alerted the
Secret Service because these are coming
out of China this is a legal tender coin
as long as China allows these
manufacturers to produce these legal
tender coins it is an act of war when
one country counterfeits another
country's legal tender currency and so
this is very very serious James has been
reporting this to the Secret Service and
he has been successful at getting a
couple of retail sources in the United
States shut down not shut down but get
them to drop count carrying these once
they realized how serious this is
yeah actually eBay did that recently a
lot of help from the I CTA the industry
Council for tangible assets they've been
doing a great job of getting ahead of
this as well they realized it's a huge
threat to the bullion industry the
numismatic injure industry etc so they
made this release in June I CTA did this
is basically talking about how Chinese
counterfeits is their highest priority
right now in the industry so this is the
industry Council for tangible assets
correct yeah and they've been you know
very key in getting this this bill
you know supported HR 5 9 7 7 this is
the series basically adding teeth to the
it's called the collectible coin
Protection Act and it adds teeth to
anyone who gets caught counterfeiting
anyone involved with counterfeiting the
the penalties are going to be much more
substantial once once this passes but it
requires a lot of people to get out
there and tell their congressmen to get
this passed to support this bill yeah so
there's one thing that you can do at
home and that's write your Congressman
write your representatives
and let them know that you support HR
five nine seven seven there's another
thing that they can do at home too and
that's the ring test that you just did
that's four Silver Eagles we don't have
any counterfeit gold eagles here they I
have a whole stack of counterfeits in my
office and and the right now the
counterfeits that are really good are
the silver products the gold product
coin wise aren't as good when you see
them the size aren't that you know
they're a little too big or their weight
is off but they're going to get better
and so you know one ping test that you
can do with a with gold 22 karat coin
you can simply do it with an eagle or
Krugerrand it's the same thing you hold
it on the end of your finger and hit it
with another Gold Eagle do that one more
time it rings for a very long time and
it's very pure sounding so it's got a
lot of sustain now a 24 karat coin
doesn't do that Gold is very soft and it
goes thud a little bit right basically
leave a dent on the coin it's so soft
yeah and so uh so yeah the different
methodology is depending on which it is
like for plating
you know we're using one methodology to
prove it for bars there's other
methodologies that are si for yeah there
are non-invasive methods so it's not as
if we're cutting things in half to make
sure that they're they're whole yeah so
and again nothing enters our system
without getting assayed and less is
coming from unless it's brand-new
product from a mint or a refiner
so I guess to touch on the mystic form
you know there's a lot of misinformed
advice out there some people when they
hear about this threat say I'll just get
the coinage just get small bars etc that
that's really doesn't that doesn't
really apply anymore these counterfeits
are only going to get better so whoever
you work with has that protective
measures that's what I used to say in my
book it says bye you know that's one of
the reasons I like to buy silver eagles
is because they're less likely to be
counterfeited the penalties for
counterfeiting something that's not
legal tender
you're basically committing fraud when
you counterfeit something that is legal
tender its counterfeiting and
and the penalties are much greater I am
really surprised that people are taking
this risk I guess there's not a whole
lot of risk for the pill the mints in
China that are producing this stuff but
anybody selling it in the United States
is taking a lot of risk there's some
major jail time that goes with this it
falls under the previa of the Secret
Service and they're everywhere in the
United States they will you know anyone
who really gets in this business the
warning to anyone who's thinking about
you know getting involved with
counterfeit the Secret Service is out
there and you'll end up in federal
prison very very quickly they take this
threat very seriously okay so next I
guess it's just kind of how pervasive is
this problem you know and in China in
general they are counterfeiting pretty
much everything from everything the US
Mint makes the Canadian Mint part mint
Mexican mint Chinese mint South African
mint private bullion bars are being
minted Wow
they're mint the Chinese mint they're
counterfeiting Chinese products in China
yeah exactly
right I would imagine that they could
suffer the death penalty for something
like this it's amazing yeah okay there's
old fake collectible coins too this is a
huge threat in the in the numismatic
world as well they're they're they're
they're basically faking old Morgan's
they're faking old walking liberties
they're faking old British coin old
Spanish coinage you know basically any
type of thing that has value they're
trying to fake okay and and that it also
includes all the bars that are being
produced by different refiners and so on
that's correct yeah whether it's silver
they'll use the plating to have gold
plating bars as well and then some of
them are more advanced like the ones
that were caught in September in New
York where they're actually hollowing
out and leaving a thicker layer of gold
so x-ray machine will be able to detect
it whereas a sound machine would be able
to detect that tungsten that was in
there so you know some of them are much
more complex and they are actually
exploiting a lot of these you know
Street shop dealers with these advanced
techniques one thing about this fake
silver eagle that I want to point out
too is that the magnet test does not
work on these they're not magnetic at
all digital on a digital scale it weighs
one and troy ounce so it's very hard to
detect there are a few telltale signs
that you can see on the coin itself yeah
the coins are going to get better and
better until eventually you can't tell
right now what you said the font on the
date right yeah the dates font is off
the Rays of Sun are not tapered that
well they're kind of boxy and square the
flag itself has a little bit too much
webbing and just in general the strike
is not it doesn't have a smooth of a
strike as the as the true Silver Eagle
does okay you know I just want to jump
in and say most people sort of know how
I feel about numismatics I don't think
they're a good investment at all I think
it opens the door for people getting
ripped off a lot of people that I know
have been ripped off by buying way
overpriced coins the price of gold goes
up two three four times and the and this
is something that has happened to people
that are friends of mine they went out
and they they bought some bullion from
me but then they went out and they
bought a bunch of numismatics elsewhere
because somebody used the con of that
these coins are non confiscate able
which is a bunch of crap basically don't
believe it
and they made huge investments and a lot
of these coins where you're paying many
many many times over the gold count
you're paying a content you're paying
for the rarity you're paying for the
collectability of it and those coins
actually went down gold went up three
four five times and those coins fell in
value but I don't own any numismatic
coins but somebody gave me a ms70
Silver Eagle one time and when I speak
around the world I usually travel with a
bunch of gold and silver coins in my
pockets that I can pull him out and hold
him up on stage and on this one trip I
had forgotten to take any gold or silver
with me and I realized that in my
briefcase I had a numismatic coin in a
slab I gave this slab it's called the
plastic container for a numismatic coin
to the hotel maintenance man and asked
him if he could get it if he could get
it open for me and get the coin out I
was expecting this thing to be destroyed
came apart perfectly and somebody can
take a fake Silver Eagle which I think
you can buy for like a buck or something
for you and there's a silicone gasket
that goes around the Silver Eagle that
I'm not going to bother trying to put on
right now because it takes a minute and
then you put it in here and now you
can't do the ring test it's harder to
prove that this is counterfeit once it's
in the slab and it's very easy for
somebody to do and James just informed
me that they are making counterfeit
numismatics it all slabbed in everything
look perfect with Holograms and all the
rest of this stuff coming out of China
so what it comes down to is that if
you're going to buy any gold or silver
buy bullion profit that's what I buy is
bullion and but you've got to be careful
who you're dealing with because it's
very important that you deal with the
dealer that has a guarantee and that
tries their best to protect everybody
from this yeah
that's how you avoid faces by knowing
your dealer making sure they have
counter counter counter proof measures
in there but basically verifying all the
products that they sell you whether it's
first hand product right from the mints
or secondary product they definitely
have to have measurements in place to
prove whether or not these are real or
you know these products are counterfeit
okay and as well you know the guarantee
is important too if they're not willing
to guarantee the product they're selling
and that that's a flag as well and I
guess the other thing is just to be
aware of you know if you're buying from
eBay or Craigslist or from a local coin
shop around the corner high chances that
there's no guarantee there you know or
they don't have these kind of you know
counter proof measurements in place so
be very wary of that okay anything left
to cover I thinks it we're just
definitely going to stay on top of this
as other counterfeits come available or
things that we know notice are realized
we'll definitely keep our customers
apprised of it and and and stay ahead of
this one last thing I want to mention is
that for people with storage accounts
there isn't anything to worry about when
you have a storage account your product
is coming from
a mint or a refiner directly to the
vault and it stays in the vaulting
system it's only when something gets out
into the public that it becomes suspect
when it's coming back into the vault so
there's nothing that and I've got
storage accounts and and I love it that
way so yeah anything staying within the
chain of integrity that's totally fine
you know it came right from the mint or
the refiner that's exactly that's like
Mike said it's in the chain of integrity
it's verified when it comes from the
public to us we do our proprietary assay
measurements to make sure that it's
valid and it's authentic so everything
is a place to make sure that we're all
secure
so we've either got brand new product or
a product that has been assayed that
that came in and joined the brand new
product so for inventory
I think our industry needs to understand
that this is legitimate thread and put
in place secure measures yeah and we're
actually giving a gold silver guarantee
of authenticity that everything that we
sell is what its represented to be or
your money back okay so we're going to
keep everybody up to date on this and
let you know if there's any further
developments I want to thank you and
thank you James Sam thanks Mike okay
you