PNG Warns Against Coin Telemarketers
Wednesday March 19, 2008
The Professional Numismatists Guild (PNG) has issued a warning about the increased level of coin and bullion sales related telemarketing activity that is being seen as the gold and silver bullion markets continue to surge upward. The PNG warning offers three tips to avoid losing money:
(1) Before you buy or sell bullion-based coins, check the spot price for precious metals that day. The market is very volatile right now, and swings of 5% to 10% or more can happen quickly, in a matter of days or even hours in some cases. Don't buy or sell until you've done your homework.
(2) Know who your coin dealer is and take delivery of your items. It only takes a moment to check out a coin or bullion dealer. Get the name of the company and ask if they belong to any industry associations, and don't take their word for it. You can verify claims of affiliation, such as with the PNG, by checking with the organization itself. Although the PNG warning didn't stress this point very much, I personally believe that you should always take possession of any bullion you buy! Store it in your own safety deposit boxes or other secure places under your control. If you let the coin or bullion dealer keep (or "store") your bullion and his business goes under, or he has his stock seized by the Feds because he didn't pay his taxes or something, you will likely lose your entire investment. Unless you take physical possession of your coins and bullion, the spot price of gold will be the least of your worries!
(3) Stay informed about the relevant laws and tax implications of coins and bullion. Everything from local ordinances to the Federal Patriot Act can contain provisions about the buying and selling of bullion and bullion-based coins. Issues such as whether or not sales tax is charged (which can add another 5% to 8% to your purchase price when buying) or IRS regulations (which may require the issuance of a 1099-Misc. form when selling) can all affect your bottom line.
The PNG Web site has a number of informative articles about coin collecting related subjects, including their interesting booklet for beginners called the "Rare Coin Primer." Strangely enough, I wasn't able to find the information they offered in their bullion warning press release, a pamphlet called, "What You Should Know Before You Buy Rare Coins." For that, you'll have to send them a dollar (to cover postage) via snail mail. Write to:
Robert Brueggeman
PNG Executive Director
3950 Concordia Lane
Fallbrook, California 92028
(1) Before you buy or sell bullion-based coins, check the spot price for precious metals that day. The market is very volatile right now, and swings of 5% to 10% or more can happen quickly, in a matter of days or even hours in some cases. Don't buy or sell until you've done your homework.
(2) Know who your coin dealer is and take delivery of your items. It only takes a moment to check out a coin or bullion dealer. Get the name of the company and ask if they belong to any industry associations, and don't take their word for it. You can verify claims of affiliation, such as with the PNG, by checking with the organization itself. Although the PNG warning didn't stress this point very much, I personally believe that you should always take possession of any bullion you buy! Store it in your own safety deposit boxes or other secure places under your control. If you let the coin or bullion dealer keep (or "store") your bullion and his business goes under, or he has his stock seized by the Feds because he didn't pay his taxes or something, you will likely lose your entire investment. Unless you take physical possession of your coins and bullion, the spot price of gold will be the least of your worries!
(3) Stay informed about the relevant laws and tax implications of coins and bullion. Everything from local ordinances to the Federal Patriot Act can contain provisions about the buying and selling of bullion and bullion-based coins. Issues such as whether or not sales tax is charged (which can add another 5% to 8% to your purchase price when buying) or IRS regulations (which may require the issuance of a 1099-Misc. form when selling) can all affect your bottom line.
The PNG Web site has a number of informative articles about coin collecting related subjects, including their interesting booklet for beginners called the "Rare Coin Primer." Strangely enough, I wasn't able to find the information they offered in their bullion warning press release, a pamphlet called, "What You Should Know Before You Buy Rare Coins." For that, you'll have to send them a dollar (to cover postage) via snail mail. Write to:
Robert Brueggeman
PNG Executive Director
3950 Concordia Lane
Fallbrook, California 92028
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