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Should Bank Tellers Be Able to Buy Silver at Face Value?

By May 5, 2009

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Reader "Skent256" brings up a provocative issue in the coin collecting forum:

I know a bank teller that has a serious coin collection. At her bank, the savvy tellers swoop up silver coins from deposits. There's no theft involved, just replacing silver coins with clads. I think there's ethical issues surrounding the practice, in my mind. I suspect most coins are inspected to remove silver coins. Just an opinion... not trying to make a mass generalization of bank tellers.

This is an interesting question because in a way, the teller is depriving her employer (the bank) of profitable value if she takes the silver coins to a coin dealer and sells them for the silver value. On the other hand, the bank itself is unlikely to profit from this silver otherwise because it wouldn't normally have known about the silver or bothered to find it.

So, what's right here? Should the teller pass up the opportunity to grab the silver at face value so as not to be unfairly profiting from her employer's assets? If she does take it at face value, knowing it is worth more, isn't that stealing? Come share your views in the coin collecting forum!

Comments

May 6, 2009 at 11:54 am
(1) Stuart R. says:

In my opinion, banks are in the business of storing and then releasing money to their customers, and making money off of loans and investments. They should not charge people – even their employees – more than face value for coins or currency. If they start to do that, they become a coin/currency dealer and not a bank. It also would remove some of the fun of collecting, I think, since many of us have formed connections at local banks and have the tellers watch for special things like rolls of dollar coins, old currency, or silver coins.

Now, I think a bank should be up-front with a collector if there are other tellers culling for their own purposes. And I also think that a bank SHOULD have a set policy with their tellers for things like that so there is no question about any possible policy violation. I also think the bank should have a policy in place such that if, say, an older person comes in looking to cash out a reasonable amount of silver coins for face value the teller can direct them to a local coin dealer so they can get at least the going rate for junk silver rather than face value.

But otherwise, I disagree with the idea that a teller shouldn’t be allowed to pull silver coins for themselves and purchase them for face value. If I were a bank teller, I would actually be one of them, pulling silver coins, wheat cents, old nickels, and a lot of the new stuff to look through myself. That’s what I did when I worked at a grocery store, counted the coins and bills in my high school band’s soda machine, and I don’t think there’s anything wrong with that as long as the people in charge are okay with it and know you’re doing it.

May 6, 2009 at 12:02 pm
(2) Rick says:

I was a grocery clerk for many years. I found everything from currency/coin oddities to silver. It was just a perk of the trade. Base values are set by the federal gov.. Collector value is set by the buyer.
When the Feds offered silver for for siver cetificates that could cross the line.

May 6, 2009 at 2:11 pm
(3) coiny says:

When ever someone is in a higher posistion over the general public that has an unfair advantage, that is a conflict of interest. There are laws against it in some cases. It may be small patatoes in this case as it seems, but being in that posistion is really unfair enrichment at the expense of the public. It’s wrong. I know i’m a party pooper. I’d like to do it too. I just can’t.

coiny

May 6, 2009 at 2:46 pm
(4) collector says:

I don’t think they are doing anything wrong against the Bank – they are counting the money coming in and checking against what is going out – as long as the money is replaced the Bank isn’t losing. I’ve known a case where a Bank teller received a roll of piece dollars and was asked to change them at face value – and they obliged (I guess it was a spouse wanting to get back at their ex) and the tellers eventually swapped the coins for notes. They were in a priviledged position, but the Bank had no option but exchange them for face value – and not their numismatic one. In following the St. Gauden saga of the 10 1933 coins found, I know it hasn’t concluded yet, but part of the explanation I have read which would have legally allowed the coins to be taken was if a mint worker exchanged one gold piece for another. In the accounting books, you still have the same value and amount of gold. Let’s see what the courts decide….

May 6, 2009 at 6:10 pm
(5) Scott B in DC says:

A relative who worked for a bank once told me that it does not pay for them to worry about collectibles that pass through the tellers. Based on the costs of operations and the costs required to dispose of them, especially for big banks, it is not worth the time and expense. Besides, not all banks have numismatic experts on staff. It would create a special handling situation that may compromise security.

Since the banks do not want to handle these coins separately from their regular operations, tellers who do collect or tellers who do help collectors see this as a perk of the job. Even with the slower economy, keeping performing employees is still important since training new employees cost more than what they lose in change picking.

May 6, 2009 at 6:31 pm
(6) Blazed says:

I agree with the fact that either the bank manager or teller supervisor should be aware of this practice just for liability reasons. I was working at a retail store and picked through every piece i could get my hands on as well as having the people in accounting room doing this for me as well. I did however have the store managers permission for this. To say it is unfair is true, but it is just one of the perks of the job. Its like saying flight attendants should have to pay for the flights they are on. Just my two cents.

May 6, 2009 at 7:07 pm
(7) www.fine-estate-auctions.com says:

I think there is a difference after reading the above comments between searching cash from the register of a store one might own or work at (with permission) and the question of tellers having the right to swap out coins (e.g. silver for clad, etc.) or simply “buying” them for face value (taking four quarters and replacing them with a dollar bill). This is definitely an unfair advantage the teller is in and opens up ethical issues. What if an old lady comes in with her hoard of silver dime rolls and wants to convert them to paper so she can put a fifty dollar bill in the envelope of her grandkids birthday card. We’re assuming she has no idea what she’s got, right. So the savvy teller can grab those right up and replace them each for a five dollar bill !!?? That’s criminal in my opinion! Forget just the advantage of he/she getting 90% silver coinage for face value- what if they’re uncirculated rolls. Please, it gives me a headache to contemplate. Believe it or not, I would rather see a policy where this currency was returned to the U.S. Federal Reserve/Treasury rather than individual bank tellers taking advantage.

May 7, 2009 at 1:11 am
(8) Caroline says:

If I go to my job and spend 10 minutes or
10 hours per week surfing instead of working
I would be stealing from my employer. If a
bank teller takes the time to sort through
coins she is stealing time from her employer the bank.
I really agree with the poster who mentioned
elderly people bringing silver in, some kind
gentle person should update them on the value
of their coins.

May 7, 2009 at 5:04 am
(9) coinfanatic says:

I think its up to the employer and the boss, back in the old days they used to trade animal for sporting good example a cow for a bottle of rum. so changing a silver to clad is the same amount if your not a collector like a bank they don’t need silver they need the money to be replenish they don’t want the old coins and silver sitting in their volts, they want those money to go around. same as the guy trading a cow for a rum. you think that’s fair? no, but that’s what the guy want to have what he need. Even worse a land for a cow, you don’t need land if you dont have nothing to eat? bank don’t need silver its worth less for them so who ever will change it for the face value get it.

PAWN SHOP they buy things for less then the collectible value, and turn a round sell them double or tripple the price. Is that stealing?

If you are on the position people will try to get the things they want, people grambling because they want those things instead the guy in the position getting it. It doesn’t happen only in coin it happen on all of things.

Cops let go people they pull over specially if it was a hot chicks or famous, so if your a man or regular people then too bad your getting ticket, to the cops the chicks is silver the man/regular people are clad?

There is cons and pros so there is no right way to do it.

May 7, 2009 at 6:00 am
(10) coinfanatic says:

Beside even though your are a teller if your boss want it, the boss getting it before the teller. If your a teller and the silver coins spend on a grocery store your not getting it, maybe the cashier or the manager will get it and if not there is so much bank out there maybe they deposit it to you or to your neighbor teller or neighbor bank. You could be a teller for 20 years and never seen a silver coin in your transaction while the 1 month teller got couple silver coin on the transaction.

Mostly people in the position can bend the rules just to get things they need. They have previledge to get the coins. You could be a teller and get all the silver you can get and I’m a millionaire and can have all the silver you collected in your life in half hour.

Would you be a teller getting paid 10 bucks per hour maybe get some silver coins every week, or a nurse getting paid 25 per hour and can buy silver coins with the money shes getting paid in less then hour?

May 7, 2009 at 6:10 am
(11) coiny says:

I agree with # 8 & # 7. Unless the pilfereing is done after bank hours, or on te bank employees lunch break, they are stealing time from the bank. Secondly, 40% silver bags and 90% silver bags are not sold on a dollar for dollar basis. They are sod for the value of their silver content at bullion prices at the time of sale. So to me, what is going on is theft on both fronts. Regardless of their posistion of being there at the right time. And having access to silver coins. Not much different than insider trading. Ask Martha about he feelings about that!

coiny

May 7, 2009 at 6:14 am
(12) coiny says:

Sorry about all them typos. I think it’s still understandable. I’ll do better next time.

coiny

May 7, 2009 at 3:40 pm
(13) mike says:

It seems to me that you guys are just crying about you not getting them. What do you expect, the teller to wait for you to walk in and ask if they have any rolls of anything or silver anything? What make it right for you to buy a box at face value and search through it and find silver? Maybe then you should go back to the bank and give it back to them. After all, you only paid face value for it.

May 7, 2009 at 4:00 pm
(14) coiny says:

Well mike! Ya could be right. But — There is a difference between cherrypickin bank customers, and bank employee — LOOTERS

coiny

May 7, 2009 at 4:05 pm
(15) skent365 says:

Hello:

No one’s crying… we’re just having a discussion on an interesting topic.

May 7, 2009 at 8:15 pm
(16) Stuart R. says:

With the 14 comments since mine, I wanted to add a bit: For those of you complaining that the searching should be done on their own time and not on the employer’s time, you may not realize how easy it is to spot what you want just in the course of normal transactions. And yes, I’m speaking from experience here as a cashier, though not as a teller.

For example, it is generally very easy for even a novice collector to tell a silver coin from a clad. It is also very easy to recognize s bill with a different color seal or one from before the modern designs (e.g., a red seal $2 from the 1960s a teller found for me, or a 1928 $100 a teller found for me — neither of them look like their counterparts today and they stand out easily during any transaction if you pay the slightest amount of attention to what you’re doing).

Now, when you get to things like star notes, war-time nickels, wheat cents, and stuff like that, it does take more time and is generally not as obvious during normal transactions. For finding things like that, I agree it should be done on their own time, or perhaps during a 2-minute lull in the crowd of customers. During those short lulls, it’s easy enough to thumb through a small pile of bills or to quickly look through your nickel till, whereas doing anything productive during that minute or two is not nearly as easy.

May 8, 2009 at 11:53 am
(17) Mike says:

I agree wholeheartedly with #7. As for coinfanatic’s comments about Rum for Cows or vice-versa; well I think he should get a cow and stop tipping the rum bottle- if you know what I mean.
But seriously folks– trading a cow for rum is clearly a different equation as they each have rather different functions. The argument here is in no way disputing that a silver coin will function as currency at face value the same as a clad equivalent.

The argument is whether it is ethical for bank tellers to have the unfair advantage and opportunity to personally prosper by obtaining the intrinsic value of silver and/or the numismatic value of a rarity at merely face value and perhaps likely at the expense of an unknowing bank patron and probably by taking some time away from what they are actually being paid by the bank to do.
Doesn’t it come down to the question of would you do this to your bestfriend or a relative? Then why do it to a bank patron? Why not explain to them that they could easily get many times the buying power these coins could bring over their face/denominational value because they’re collectible and/or have silver content– just by bringing them to a reputable coin dealer.
What happened to the GOLDEN RULE? (or in this case the SILVER RULE- HA!)

May 8, 2009 at 1:44 pm
(18) Al says:

Just wanted to say, When my grand parents lived in Fl.,my grandfather had a stroke an they had to move back up north. My grandmother not knowing the value of my grandfather’s coin collection went to the bank to cash it in. I remember her saying how odd it was when all the tellers came to her window to see what she had. I’m sure she had no clue as to what his collection was worth.

May 9, 2009 at 4:22 am
(19) coiny says:

I can say, i smell a law suit brewing. At some point, someones grandmother or father. Is unsuspectingly going to cash in a valuable collection at a bank. The grandchildren are going to get wind of it. One of the chilfren will just so happen to be a numistmatist, & attorney. Then the S*** is going to hit the fan. It may be everyone gets sued, im sure including the bank. Now, won’t that look great on a resumie to their next probable employeer?? Bah humbug. Their acting like crooks. If theres a doubt in their minds, or any one that works the register. Then it probably wrong. For those who could care less. Maybe the law has a name for it. I remember a law called unjust enrichment. Said enuff.

coiny

May 11, 2009 at 11:47 am
(20) Dante says:

About the coin-swapping question, I have strong mixed feelings as most avid coin collectors do. I really love finding silver in a bunch of clad, it’s addictive.

In the end, though, swapping clad for silver in the manner described makes me feel dirty and guilty, like I stole something.

And there’s the rub – if you feel guilty doing it then it’s probably something you should not do.

May 11, 2009 at 2:27 pm
(21) coin database says:

There is no problem with it since the bank is most likely not culling it’s coinage for silver. I doubt it would be cost effective for a corporation to do so.

The bank teller isn’t hurting the bank. It’s possible the coins don’t get melted and instead end up in the hands of collectors. Making a small profit off of something like this is one of the great things about having an economy like ours.

May 11, 2009 at 9:39 pm
(22) Dragonfly says:

I don’t blame restaurant workers for getting a discount on their meal. I think that as long as the teller asks the management if there is a problem with the practice and they are given the go ahead then there is not an issue. For the most part it seems the issue is with being sneeky. If the boss says “No” then it is wrong, and visa versa. It never hurts to ask, and then you know.

May 21, 2009 at 1:45 am
(23) coiny says:

If the looters work in hooters, they can have my silver anytime.

coiny

June 8, 2009 at 2:14 am
(24) soytenly says:

give it a rest. tellers work hard who cares if get some silver?? god, all this talk about ethics!!!!

October 16, 2009 at 2:46 am
(25) Chris says:

I myself am a coin collector, and I don’t believe this article is about the teller “doing the right thing.” I think the writer of this article is jealous of the teller, because they have first pickings over the silver that you feel should rightfuly be yours. I know it doesn’t seem really fair, because they don’t have to do all the hunting that we collectors do, but the teller is not breaking any laws. Honestly, the teller is quite smart for taking advantage of the situation. Who am I to judge them? You know for a fact, if you were in the same position, you would be raking in the silver for yourself, and not giving it a second though. I know I would…

December 23, 2010 at 5:26 pm
(26) GingerKitty says:

And what does the teller do when the customer is advised that the silver coins she is trading in could definitely be worth more than their face value and asks if she (the customer) is sure that she wants to turn them in — and the customer then says “I don’t care. They are taking up room in my safe deposit box, they are heavy and a bother, and I’m not a coin collector. Cash it in and put the money in my account.” Does a teller then tell the customer, “I’m sorry — I’m not going to do that because the silver is worth more than the clad and that’s a stupid thing to do”? How quickly does the teller get fired after THAT conversation? And, if the customer sometime thereafter dies, and half a dozen unscrupulous, greedy relatives crawl out of the woodwork come whining to the bank that their relative was incompetent and the bank should never have “let” her take the money out of her own safe deposit box and put it into her own checking account, what then? Why didn’t that poor excuse for a relative see to it that their incompetent family member was taken care of BEFORE she gave away her own money and then died by having her declared incompetent in a court of law and having someone appointed as the guardian of her person and property? AND, when the relative showed up demanding that those tellers [who did what every person working for a bank has done forever — that is, (1) use the knowledge they have to legally purchase money available in the till of the Bank available to everyone else in the general public to obtain some nice coins for themselves, and (2) to give the coins as change from their cash boxes as they are required to do for their customers, regardless of whether the coins are silver or not –makes a scene in the lobby and demands that the teller return every coin they purchased and call every customer who otherwise obtained the coins as change (like THAT can be done) and the bank management THEN decides, although managers WERE informed by the tellers of what had happened and who had purchased coins, that the tellers behaved behaved unethically because they didn’t tell the greedy relative during the scene-making process that they had purchased some of the coins themselves. Something has become badly skewed in the definition of ethics, folks. The first thing the banking industry and it’s risk management personnel need to do is to actually sit down with their employees and give them some indication of what is and is not permitted. “Use your common sense” is just a hack response, when every teller in the banking industry has been allowed to do this as long as there have been banks on the planet — UNLESS the bank gives some indication that this is an unacceptable policy. A bank teller cannot reasonably be expected to tell a bank customer who from all evidence appears to be in their right mind what they can and can’t do with their money. A bank teller cannot refuse to permit someone to empty their own safe deposit box, regardless of who else is on the signature card, if the safe deposit account has not been established under the criteria that no one signator can empty the account without the permission of the other signator. And without a court order presented to the bank evidencing the incompetency of a client, a bank cannot legally withhold a client’s personal property. Once the money is sold to the bank, it is then the Bank’s property. If the Bank doesn’t want it’s employees swapping coins, they should say so — although by the same token, they should not then allow a customer or employee to turn in a filthy bill and ask for a nice crisp, clean one, or to change out a $20 bill for two $10′s. Duck duck goose, guys. Management needs to take responsibility for it’s own policies, make them clear instead of so obtusely vague that no two people without a law degree can translate them the same way twice, and get some consistency instituted in how they establish and enforce their guidelines. Frankly, if I were the lady who wanted to cash in my silver for face value and were told I couldn’t do it by a teller, I’d take my business elsewhere immediately. If I were incompetent, my relatives would have done better to take care of me BEFORE I died, instead of trying to claim property that I no longer owned BEFORE I died because they are greedy gits. And a bank that accused a long-time, dedicated employee of being unethical because they didn’t speak publically to a customer making a scene in the lobby is a bank that no good teller in their right mind should work for, for long. Often as not, the bank would advise the teller that you are to tell MANAGEMENT when they have something to say, and to volunteer NO information to customers or other persons in the bank, because there is no way to tell how that information could be used by that other party.

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