Professional Coin Grading Service

China Product


Influence

Though PCGS was not the first company to provide independent grades (photo-grading services and the ANA's own ANA Certification Service already provided coin grading but at the time) or even the first to introduce the hard plastic protective slab (a smaller company, ASA-Accugrade, claims a patent dated two years earlier), PCGS is credited by coin experts as founding the movement of formal professional third party coin grading.

PCGS introduced the "slabbing" revolution to professional numismatics, in which a coin is encapsulated with an accompanying tamper-resistant certification of its grade. This packaging transformed rare coins from subjectively appraised valuables to numerically valued commodities that could then be traded sight-unseen among coin dealer and outside investor networks. About a year after PCGS was founded, one of their founding members, John Albanese, left and started rival company NGC, and the two have since dominated the coin grading industry. sinamay

The introduction of objective grading attracted considerable new interest in rare coins by investors such as those from Wall Street firms. This lead to a dramatic rise in rare coin values from 1988 to 1989, followed by a collapse of what became an economic bubble in 1990. Since then, the average value of coins have stabilized and shown a slow and steady gain, though the market continues to exhibit fluctuations. easter symbols

In 2002, the Professional Numismatic Guild surveyed members on the quality of the various certification services, with PCGS and NGC both scoring the highest in rank. Subsequent repeats of the survey have given similar results. topiary trees

Coin Holder Design

The PCGS holder is made of transparent, colorless plastic and is designed to be stackable. Anti-counterfeiting measures include a holographic emblem on the back, the design of which has changed over time. The current design depicts the name "PCGS" and the Collector's Universe NASDAQ stock symbol, and a Saint Gaudens double eagle. On the front in pastel blue, the coin information provided includes its type, denomination, grade, and a unique serial number assigned to that particular coin, as well as a machine-readable barcode. Coins that are improperly cleaned, have altered surfaces, or are otherwise damaged will not be graded by PCGS but will still be certified as genuine; such coins are placed in holders that specify "GENUINE" on the front label in place of a grade, and on the back below the holographic emblem will have the phrase "GENUINE NOT GRADABLE" printed. The holder is formed from two parts that are joined over the coin and a paper insert by way of sonically generated heat. Note that though the holder is airtight, it is not vacuum-sealed.

Original first-generation PCGS coin holders are smaller and lack the raised stackable edges of later issues. The original label insert was printed on a green insert. In some of these early holders, the coin on occasion will be loose enough to produce noise when the holder is handled, thus giving rise to the affectionate nick-name of "rattler" to these holders by the coin-collecting community.

The appearance of counterfeit holders early-on led PCGS to introduce a redesigned holder with a holographic emblem next to their logo on the back. Subsequent improvements in technology gave rise to several minor redesigns since, including a transition from the original light green labels to blue ones. PCGS was at one point in time named the official grading service of the Professional Numismatic Guild; during that time, the PNG logo was included on the back as part of its holographic design. This feature was replaced with the current design when PNG switched their affiliation to NGC.

Population Report

PCGS maintains a census of all coins they have graded since their inception, revealing the incidence of each date, mint mark, and reported variety of particular coins, as well as prominent feature designations such as "prooflike" Morgan dollars or "full bands" found on the reverse of better-struck Mercury dimes. Access to this report is available to dealers and paid members of the PCGS Collectors Club, an annual membership service that allows non-dealer individuals to submit coins for grading. The report is updated continuously on their web site, though a printed version is published at regular intervals.

Analysis of this report and a similar one published by NGC has allowed numismatic professionals to estimate the rarity of specific coins, and over time these two data bases have revealed some coins once thought rare to be remarkably common, whereas others thought more common have shown to be likely few in number. The population reports are followed closely by numismatic professionals, but they also recognize that their numbers can be inflated through multiple submissions of the same coin, broken out of its holder and re-submitted with the hopes by the sender of receiving a higher grade, or deflated through reluctance to submit a common coin of little value for a service that costs more money than the coin is worth.

Additional Services

In addition to a population report, PCGS publishes a price guide accessible to the general public including a video by president David Hall of weekly market condition updates. A Set Registry allows coin collectors to register PCGS-certified coins in competitive sets, ranked based on fineness of grade and degree of completion, with famous historic coin collections also listed for comparison. Unlike NGC's Collector's Society, which allows registration of both PCGS-certified coins and NGC's, the PCGS set registry is limited only to PCGS-graded coins, with the exception of the before-mentioned historical comparisons.

Controversies

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In the May 26, 2003 edition of Coin World, the hobby newspaper had announced they had contracted investigators to conduct a year-long, comparative study of PCGS, ACCGS, NGC, Numismatic Guaranty Corporation and several other grading services, each know as a Third Party Grader (TPG). In their investigation, several of the same coins were sent to each grading service over the course of a year, each graded by all Third Party Graders sent to. In no case did the grading services agree on the grade of any given coin, and in some cases the difference in grading was seven points off. Coin World further reported that in one case ACCGS had graded a coin as "cleaned" and several grades lower than PCGS, which PCGS had not noted the same coin was "cleaned". PCGS had failed to note on their holders that thousands of shipwreck coins had not been cleaned, although the coins were in fact encrusted with sea debris and barnacles, and cleaned in acid baths. It is standard for professional dealers to note when coins have been cleaned or treated in acid baths, and not doing so can be considered unprofessional and unethical by some numismatists. Further, in U.S. Numismatics, it is standard to grade coins on a point-scale from 1 (poor) to 70 (perfect) and to note on the coin holder if a coin has been cleaned or poorly mishandled, or in some cases, to reject it for encapsulation.

In 1990 the FTC (Federal Trade Commission), which oversees business ethics and fraud, filed a civil action against PCGS alleging exaggerated advertising claims. PCGS did not admit wrongdoing, but agreed to submit its advertising for review for a period of five years. In a filing in Federal district court in Washington, the company agreed to include a statement in its newspaper and television advertising affirming that certification by PCGS does not guarantee protection.

In September 2004, members of the American Numismatic Association reported seeing counterfeit PCGS slabs at the Long Beach Coin Show. More were reported on eBay in the years following, but PCGS did not address the issue until March 27, 2008 with the following acknowledgments on the PCGS website:

"The counterfeit PCGS holders are well-executed, but with minor differences from a genuine holder. PCGS anticipates that authentic coins will eventually be placed into counterfeit PCGS holders in the future, perhaps with elevated grades and/or inappropriate designators.

The following list of coins and certificate numbers have been seen in fake PCGS holders:

China (1916) Silver Dollar, Y-332, Cert #10712316 (valid)

China (1923) Silver Dollar, K-677, Cert #11354470 (valid)

China (1923) Silver Dollar, K-678, Cert #11285683 (valid)

China (1923) Silver Dollar, Y-336.1, Cert #13835186 (valid)

China Republic (1912) 20 Cents, Cert #21981173 (invalid)

China (1916) Gold Dollar, Pn-44, Cert # 11072163 (invalid)

China (1923) Gold Dollar, Tsao Kun, K-677, Cert #11354470 (invalid spec, valid certsed above)

US 1858-O Half Dollar, Cert #03884338 (valid)

US 1800 Silver Dollar, Cert #03859118 (valid)

US 1795 Silver Dollar, Off-Center Bust, Cert #22030856 (valid)

Mexico 1761-MoMM 8 Reales, Cert #05763936 (valid)

"Valid" means that the correct information shows up under Cert Verification."

The above listing consists of only the counterfeits known or reported by PCGS as of March, 2008. Other PCGS counterfeit holders have been reported in eBay forums and more may be reported by other firms and individuals, since PCGS anticipates that authentic coins will eventually be placed into counterfeit PCGS holders, and counterfeit holders may multiply and improve over time. PCGS offers no reimbursement liability for the prices paid for coins in their counterfeit holders. PCGS has an online link to verify the Cert numbers, however, many buyers may not be computer users or may be unaware of their link. On January 7, 2008 Numismatic Guaranty Corporation (NGC) posted a notice on their website that high-quality counterfeits of their holders had been purchased on eBay : "Most frequently Trade Dollars and Bust Dollars are found, although Flowing Hair Dollars and foreign coins have also been seen. A range of grades is also represented." Caution is advised when purchasing coins in PCGS and Numismatic Guaranty Corporation (NGC) holders as the seller can disclaim liability due to the "third party" nature of the counterfeit holder. Additionally, it may be too late to request refunds from eBay sellers before Cert numbers can be verified as counterfeits. Many coins are posted on eBay "as is" and with no return privileges.

See also

Coin collecting

Currency

External links

Professional Coin Grading Service

New York Times Article on the 1990 FTC action

References

^ Travers, Scott A. The Coin Collector's Survival Manual, 6th edition, page 74. House of Collectibles, 2008.

^ Professional Numismatic Guild's 2002 survey of coin grading services

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