US Coins

Chinese counterfeit seizure in Chicago first positive

The U.S. Customs and Border Patrol’s April 20 seizure in Chicago of 361 Chinese-made counterfeit U.S. Trade dollars is the first positive sign that the federal government is aware of and now ready to devote resources to help stem the tide of millions of fakes flowing into the U.S. market annually. Most heartening is the fact that Customs officials indicate they do not intend to just intercept shipments of counterfeits, but will pursue those in the United States who are knowingly purchasing fake coins and selling them on eBay and in other venues.

Since Coin World first published an investigative series in November 2008 we have known that Chinese manufacturers alone can not pull off their crimes. They have to have accomplices here in the United States. Chinese counterfeiters openly shared their “business model” of establishing “distributors” by making initial sales contacts in online venues such as eBay. Once confident of a distributor’s ability to pay, the counterfeiters sell direct, made-to-order fakes in large quantities, and the distributors sell into the marketplace.

While many of the “distributors” use eBay and other online sales outlets, they are also adept at salting their fakes into rolls and collector albums for sale to local shops and regular local weekend auctions associated with flea markets and auction barns. Chinese counterfeit numismatic “products” are not limited to coins. They are producing fake albums and fake “slabs” that mimic those used by major U.S. grading services. It is difficult to estimate the number of fake U.S. coins in the marketplace. In 2008 one Chinese manufacture boasted that he operated the largest of more than 100 factories in China producing counterfeit coins. Late last year he proudly proclaimed that he had opened two additional factories since 2008 because business was so good. He said the United States is his largest market, but was quick to point out that he manufactures fake coins of virtually every nation.

Although this scourge of Chinese counterfeits may seem a bit overwhelming, with good enforcement of U.S. laws, it’s possible to purge the fakes from our marketplace. The hobby and marketplace successfully overcame gold fakes from the Middle East in the 1970s. And we can turn the tide on Chinese fakes now. ¦

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