In today’s world of robocalls and fraud alerts, our “scam radar” always seems to be on ready standby. Whether it's car warranties, credit card offers, or my kids seeing too good-to-be true Lego deals on Facebook, it seems we’ve all become a bit cynical when it comes to buying. Unfortunately, this “buyer beware” mentality has struck the coin-collecting community as well. It can come in many forms: fraudulent Facebook ads, cold calls about buying coins, or sketchy television ads. As my kids would say, we have to keep on the lookout for the “sus” deals.
This week I ran into two such situations, one in which we were able to help the collector sell his coins and the other being an opportunity to steer a collector in the right direction even at the expense of DLRC. Both of these situations came about for new collectors who had a decent sum of money they wanted to use to put together a collection. One was motivated by the investment aspect and the other by an appreciation of numismatics. However, both made a critical error in their steps toward the hobby when they latched on to a dealer who didn’t want (or bother to) educate the collector and instead simply tried to upsell coins to them. It can absolutely happen to all of us when we enter into hobbies or worlds that we don’t know! But in these cases, it not only hurt the collectors but also hurt the hobby. And as a result, two individuals who could have been serious collectors and hobby enthusiasts have left numismatics forever.
At DLRC we stand behind our product and our customers. It’s simply a clear boundary between right and wrong. To that end, when I get the call that someone put together a set of coins that included over-priced bullion with autographs, purchased a “rare” and registry-quality coin at a huge price, or assembled a set of Morgan Dollars from the same seller, it sends my fraud radar up to the highest levels.
In one instance that I mentioned earlier, the collector had bought the coins over 5 years ago from a firm that does really nice advertising. However, when you dig down, there’s simply no numismatic background to the company. They don’t even attend shows as a selling/buying entity. So when the collector looked to sell the collection back, there was a lot of avoidance. In the end, I couldn’t help the collector with the company he had worked with for years as they simply don’t help collectors that are looking to sell off their coins. Sadly, I believe this is because the collector would realize their earlier buying mistakes. I did what I thought was best and we auctioned the coins for him. Luckily, he took advantage of a hot market and the coins brought some record prices. However, it still resulted in a 50% loss for him in what is the hottest market in 30 years. That’s not only painful but wrong.
The second collector had a stack of bullion that they were convinced to trade for some classic gold coins. I love classic gold as much as anyone, but if you don’t understand or appreciate these coins, it’s probably not best to buy them. In the end, this person lost $60,000 in bullion appreciation and bought coins that are worth approximately $175,000 today. Unfortunately, they paid more than that 7 years ago when the coins were only worth $115k. I had once again offered the auction concept to them but I pushed the buyer to pursue the seller to make things right. This seller, while not helping the collector originally, actually worked to make the situation better for the collector. In the end, she had two choices. She could accept the check for $200k from the original company or auction the coins with us. I told her to accept the check. Honestly, I wanted the coins badly. We’d have had a fantastic collection offering. But it wasn’t right for her. She still lost a large amount of potential earnings from her earlier investment, but ultimately this was the best direction for her. When I wouldn’t match the offer (we almost always beat any offer), I told her to take it and run.
What does all of this mean? Honestly, I’m not really sure. I know we can’t help every collector or investor - That’s not our job. But, we want to do things the right way, both for the long-term interests of DLRC and for the long-term interests of our customers. You have my word, we’ll always strive to do that! We get to work in what is essentially a hobby for many of you and we’re thankful for that opportunity. And if we can do anything to help those of you who choose to work with us, know we’ll always look at the big picture. The hobby is a fantastic one and one that we cherish, and DLRC wants to be your Partner in Collecting every step of the way. In the end, we can’t sell every coin, we can’t protect every collector, and we can’t always be right…but we’ll certainly try our best to treat every deal with integrity. And we hope that will bring you peace of mind as you give us a shot along the way.
Thanks again for reading and we hope that you enjoy this week’s Coins We Love!
John Brush and Your Friends at DLRC
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