The idea for this week's Coin Dealer Ethics discussion was sent in by Sandy B. in Corpus Christi, Texas. She wrote:

Hi,
I'd very much like to learn ways of handling coin dealers who try to scam female customers, especially women who are just starting a coin collection.

Thank you,
Sandi B.
Corpus Christi, Texas

Sandy's message reminded me of a scene I witnessed at one of those local coin shows in Las Vegas, Nevada, run by Bick International. It was the last Bick show I ever went to, because I ended up getting thrown out! The scenario below probably won't be of much help to Sandi and her efforts to gain advice on how women should handle coin dealers, but I'll have an article written next week in response to her question.

Here's this week's scenario:

I was standing at the table of the only coin dealer at the show who had any ancient coins in pick boxes, a wonderfully friendly fellow by the name of Roy Comnick (of Comnick's Coins in Prescott Valley, AZ.) An elderly lady, probably at least 80 years old, came up to the table of the dealer next to us (whose name I don't know.) This dealer had a prominent sign that said BUYING COINS.

The elderly lady, (who we'll call "Agnes,") was carrying a good-sized jar of mixed U.S. coinage, mostly pre-1850 silver and copper coins such as large cents, half cents, etc. She asked the dealer with the BUYING sign if he would look at her coins and tell her how much they were worth.

The dealer produced a felt tray and asked the lady to pour her jar of coins onto the tray, which she did. I could see the Bust Dollars and Half Dollars, high grade Large Cents, and a scattering of smaller silver coins that I couldn't quite make out. The dealer got out his loupe and looked at a few of the coins closely and asked the lady where she got them as he examined them. She said they belonged to her father and that she had run across them while going through some old family trunks in preparation for selling her house. She said she brought them to the coin show to get an appraisal and sell them since none of her children had any interest in them. The dealer (who evidently wasn't listening) asked her if she wanted to sell them, and she replied, "That's why I'm here."

While all of this is going on, I stood there watching with some interest. I've seen what happens when people bring in their jars, bottles and boxes of old coins, and I was waiting to see if this lady would be treated any differently. We weren't dealing with Wheat Pennies and worn out Mercury Dimes here! This was obviously auction-quality material that needed more than just a quick 3 minute assessment before counting up the face value and buying the silver at bullion spot price.

After 3 or 4 minutes, the dealer made a sort of grumbling sound and said that her coins weren't exactly in mint state and that copper isn't a precious metal, but "how much do you want for them?" The lady replied that she didn't know; she had brought them in to have them appraised because she didn't know anything about coins. The dealer responded that he didn't have time at this busy show (it was actually quite dead) to do full appraisals for free, but if she wanted to sell them to name a price and he'd take it or leave it.

The lady seemed a little uncertain here, and began rounding up her coins to put them back in her jar when the dealer spoke up again, "Lady, your coins are not in mint state grade. You can take them around to every table here, and nobody is going to pay you more than I will, assuming they're even buying. Do you see any other BUYING COINS signs in here? Save yourself the time and trouble and just name a price. I'm having a good show; I'll probably pay what you ask."

It's worth pointing out here that her coins were likely worth thousands of dollars each. This was one of the most remarkable rip-offs I had ever witnessed, and my heart starting pumping faster and my palms were getting damp as I saw where this was going.

The little old lady looked up hopefully into the dealer's face, and tremulously asked, "Do you think they're worth as much as a thousand dollars? I'd probably take that, they're nothing to me, I didn't even know I had them until last month."

I saw the coin dealer's pupils briefly dilate, and old poker-playing tell that lets you know your opponent has just made a BIG hand. He knew he was getting a huge gift, and as my blood starting rushing faster through my veins, in response to the outrage I was feeling, the coin dealer said, "Lady, a thousand dollars is a lot of money for these coins. Why don't I give you $700 in cash and we'll call it a deal." He was a masterful pro at this rip-off business, and already had the cash out of his pocket, counting off the hundreds while the lady watched uncertainly.

This was the point at which I finally lost it. I said to the lady (who knew I had been standing there watching the whole time,) "Ma'am, your coins are worth several thousand dollars EACH probably. Don't take his offer! Take them around and get some other offers first!" I would have said more, but the dealer had practically jumped across his table and gotten in my face and said, "This is none of your business. Get out of here." Then, turning to the lady, this dealer (who had never seen me before in his life) said, "I know this woman, she's a real shark. She hates to see anybody else make a sale. I'll give you the thousand dollars for your old coins, but that's a GIFT, take it or leave it now."

I told the lady, "Leave it! Go get more offers! Your coins are EARLY BUST DOLLARS, those are very valuable coins!" At this point, the coin dealer shouted for the bourse chairman, for security, and for the police, all in one long shout. Heads everywhere turned our direction, and several people in police or security uniforms came running from everywhere at once.

The coin dealer pointed at me and demanded that they throw me out. He said that I was interfering with his business and intimidating his customers. One of the security guards reached behind his belt and produced a set of handcuffs, and I got the point. By this time, a man that I presume was the bourse chairman came running over and rather anti-climatically told me to leave the show and that I wasn't welcome there again. I protested that this dealer was about to steal from this woman, but by then a security guard had me by the arm and was hustling me toward the exit, a little more forcefully than strictly necessary since I wasn't struggling (just shouting) and I had bruises on my arm the next day.

I do not know whether that lady sold her coins to that charlatan or not. I tried to find out who he was after the show, by calling the bourse chairman's office and enquiring about who was in that spot, but I didn't have the booth number and I hadn't bothered to pick up one of their flimsy little show programs.

There are two sides to this debate, regarding the actions I took that day. One side says that I was right to try to warn the lady (although I could have perhaps been more discreet or handled it differently once I saw the value of her coins.) The other side says that I had absolutely no right at all to say a single word; the transaction was none of my business and it was wrong of me to interfere.

What do you think? Should I have spoken up? What would you have done? Share your thoughts via the comments link below and next week we'll have a look at your responses.

Follow-Up - You can read the follow-up to this column, where we look at some of the readers' responses about the elderly lady and her coins.

I recently wrote about the Cheerios Dollars, which are the Sacagawea Dollars that were put into 5,500 lucky boxes of Cheerios cereal back in early 2000. These coins are fascinating because they were struck from a different set of dies than normal Sacagawea Dollars were struck from, and they're currently worth as much as $10k each because very few of them have come onto the market.

I should have foreseen the email avalanche I was about to be buried under! Although almost nobody can turn up a Cheerios Dollar these days, there are 10,000,000 Cheerios Pennies out there, and I feel like I've heard from fully half their owners! Most of them want to know how to get the $10,000 their coin is worth. I've had to break the bad news to these folks, that only the Cheerios Dollar coin is valuable. As for the Cheerios Penny? Well, it's not so bad that they might as well just go spend it, but as long they keep it on that little card, it's worth a few bucks on eBay. Then again, if they keep it on the little card, it'll probably get PVC damage from the plastic sealing it in. (Or are these cards made from archival-quality packaging by some chance? Does anybody know?)

I actually had a bear of a time finding a decent-quality photo of the Cheerios Penny on its little card. I finally tracked one down on an interesting site called X-Entertainment.com. The site is run by a fellow who collects (among other things) the junk that manufacturers put into cereal boxes for the kids to find. He has a page about the Millenios special edition collectible box on which he states that the Cheerios Penny and Dollar coin premiums were actually placed into five different kinds of cereal! Can anybody confirm this detail, and tell us which five cereals were included in the promotion?

Update: Reader Fred says (in the Comments below) that there were five different flavors of Cheerios, and that the coins were found in boxes of them all. The flavors included Honey Nut Cheerios, Team Cheerios, and maybe Frosted Cheerios. Fred also tells us that he used a metal detector on the boxes of cereal at the stores to tell which boxes might have the larger (dollar) coins in them! How devilishly clever! Thank you for sharing, Fred! :)

Cheerios Coins - Additional Reading

• What is a Cheerios Penny?
• What is a Cheerios Dollar?

Photo by Matt C. of X-Entertainment.com, (used with permission.)

Learning how to properly grade coins is perhaps the biggest challenge new coin collectors face. Understanding the proper grade for a coin is core to establishing its value. Whether your goal is to make more savvy coin purchases, or to appraise your own collection, being able to grade your own coins is a skill that is not optional. Although grading services have certainly filled an important gap in the marketplace since their inception, the fact is that only a small percentage of all collectible coins have been slabbed (graded and put into a holder.) Even the coins which have been slabbed are sometimes misgraded, and experts such as Q. David Bowers will tell you that you shouldn't use the label in the holder to decide what the coin inside grades at, but grade the coin yourself and let the label be your confirmation. According to Bowers, if the grade on the label is too high, don't buy the coin. If the grade on the label is too low, you may have found yourself a nice bargain!

How can you begin learning how to grade? I've got you covered in Coin Grading Made Simple.

One of the most powerful techniques you can use, when negotiating with a coin dealer, is to know how much he likely paid for a coin, and what price is the lowest he is likely to accept.  Fortunately, the coin market is so vast and complex that dealers must rely on price guides to do most of their business.  This is especially true of the dealers you encounter at coin shows or in their own shops.

Learn what these coin price guides are called, and how to get your own sample copy very inexpensively, in my article about coin wholesale price guides.