The end of the road for 3rd party grading companies?

It was only a matter of time before the Chinese counterfeiters realised that it is much easier to fake a plastic slab than a coin. Of course they are still pumping out thousands of fake coins every day but recently they have started to produce high quality fake slabs.

Fake PCGS and NGC slabs have been around for a few years through several websites (no, you can't have a link) but these were poor quality and used the same barcodes on all of them. These were intended to fool the casual buyer into believing that a cheap fake had been certified as real.

The new generation of fake slabs has individual barcodes which the crafty little counterfeiters have matched to real coins.  The quality has improved to the state where they are virtually indistinguishable from the real thing. Buying certified coins in slabs used to be a pretty good way of being sure the coin was what the seller claimed it was - no more!

The are also rumours that dishonest dealers are submitting high grade coins, MS 65 and above, for certification with a view to switching the coins for inferior grades. It works something like this: submit a nice MS68 coin worth $3000, get the coin back in a genuine slab with the correct grade. Break open the slab and put the barcode, logo and other security devices into a new plastic case with a MS62 grade coin worth $500 and put it on eBay for a "bargain $2000. Resubmit the original MS68 coins, rinse and repeat = profit!

This may or not be true as I'm pretty sure the TPG's use a pretty sophisticated scanning technique to uniquely identify a coin's characteristics. True or not, many people believe it.

So where does this leave the 3rd party grading companies? The only reason for having a coin certified was to establish it's status as genuine. Certified coins have always attracted a nice premium as they are easy to sell with an established grade and authenticity. Who is going to pay a substantial fee to submit coins that to the vast majority of collectors can't be distinguished from masses of Chinese fakes with the same barcode?

I'm not altogether unhappy at the potential demise of slabbed coins. Collectors need to learn to grade and spot fakes instead of relying on others to do it for them. I have always regarded the obsession with minute, barely discernable differences between MS grades as rather silly. Yes it's nice to have the best quality coin available but if you need to pay someone else to tell you how nice your coins might be then perhaps it's time to sell up and collect Beanie Babies instead.

Of course it's easy for me as I collect older coins rather than contrived "collector's coins". To me a coin should be intended for circulation or it's just a token. I have a few certified coins simply because I like them, not because I need any reassurance. None are in the price range likely to be hit hard by a devaluation in slabbed coins. I'm pretty confident that I can spot fakes, so I really don't have a need for the "experts". I do feel sorry for those who may have invested heavily in certified coins though.

What may appear on the surface to be bad news has the potential of a great silver lining. I shall be watching developments with great interest.

That's ok for me having predominantly circulated coins ! Lol

I think counterfeiting is hurting all levels of numismatics, slabbed and non-slabbed, with the exception of low valued coins not worth the trouble of counterfeiting.  This is one reason I'm happy to stick with circulated base metal world coins.

I like circulated coins that have a bit of wear becuase it shows they've been used and have a bit of history, I'd actually prefer to have a nice vf-xf copy of a coin rather than a cold UNC copy that was stuck in someone's collection the day it came out of the mint and hasn't seen the light of day since.  Call me a sentimental fool but that's the way I feel.

^ that's exactly what I say it's right have history !

"I have always regarded the obsession with minute, barely discernable differences between MS grades as rather silly. Yes it's nice to have the best quality coin available but if you need to pay someone else to tell you how nice your coins might be then perhaps it's time to sell up and collect Beanie Babies instead."

  You are hilarious. I always wondered how slabs were so "trustworthy". I guess I expected this to have happened years ago.