Paper Money

Nearly identical East African notes yield different results at auction

The difference between what the descriptions “one known” and “two known” can mean for auction results was clearly illustrated by a lot in the Heritage Sept. 18 World Paper Money Signature Auction in Dallas, and another one in Spink’s world paper money sale in London on Oct. 2, 2019.

In this tale of two auctions, each catalog provided the most accurate information available at the time. It concerns an extremely rare high-denomination note issued by the East African Currency Board on Dec. 15, 1921. The dual-denomination 10,000-shilling/500-pound note was worth over $2,000 at the time of issue, and much like U.S. $10,000 notes, it was mostly used for transactions between banks, but was also sometimes a part of large-scale private transactions.

Prior to last October’s Spink sale, the note was known only as a proof or specimen, a fact acknowledged by the cataloger, who called it a discovery note and wrote that he knew of “no other note in issued format.” It was graded Choice Very Fine 35 by Paper Money Guarantee and was listed with a healthy estimated selling price of from £30,000 to £40,000 ($38,250 to $51,000). It smashed through those prices at the sale. After starting at £21,000, it finally settled at £86,400, or $110,995 at today’s exchange rate, including the buyer’s fee.

The significance “one known” or “two known” was on vivid display almost a year later at the Sept. 18 Heritage auction in Dallas. There, another 10,000-shilling/500-pound note, also graded Choice Very Fine by PMG and identical except for the serial number (Heritage, A/1 02360; Spink, A/1 02663), was described by Heritage as “only the second example graded in the PMG Population Report, and only the second instance of this type offered in public auction.” It sold for $63,000, well below the Spink price, but still over $10,000 more than Spink’s original estimate.

The Heritage lot description included the comment that in 1964 the Currency Board said “that all 10,000 Shilling notes were accounted for and redeemed, but that a select few were in private hands. The exact number is unknown, although assuredly minimal.”

The current PMG census says that, as of the end of September three are known, all in Very Fine 35.

The question of whether even more may surface will only be answered by time.

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