Government Regulation Of Our Hobby....

As sad as it is, our little hobby NEEDS some form of regulation. It is appearant that our leaders have NO desire to lead or regulate. I have been working with congressmen and senators for the past two years in trying to get some form of control. While I have no illusions that "laws" will fix everything, it will at least make some things tolerable.

Hi Daniel, you said a mouthful here..."One area I wish could be better controlled revolves around the issue of grading. In my opinion, more people have been ripped off because of grading inconsistencies than all other rip offs combined".I agree 100% but my answer to that is education, not more legislation! Mike

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Originally posted by Daniel J. Goevert
I thought all coin purchases were subject to sales tax at time of purchase, so I'm not sure what red flag warning the retiring dealer is sending out.

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This depends on the state. Here in Delaware, there is NO sales tax on anything. Other states like Maryland have a limit on numismatic items up to $1000.00, above that is tax free. Wholesale sales also fall into different taxing areas.
Several states have bills in the works since the whole fiasco in Ohio. While the media loves the attention, I don't see much coming out of this in the long run.

As far as what is wrong with the hobby, I would like to see regulations on dealers, grading companies, and venues. You stated that grading causes more harm than anything, and you are probably right, however, bad dealers and these online fleamarket sellers have to be running a very close second.
With the whole internet craze allowing anyone with a coin to be a coin dealer, it has brought the hobby down. While many collectors praise the internet with allowing everyone to be on a level playing field, if they would take 5 minutes to honestly look at the hobby as a whole, they would see that it does not.
More people buy junk coins on ebay than through all the dealers combined. Counterfeit sales are at an all time high. This is a direct reflection of the internet flea markets.

Regulations will not cure anything, as they never do, but until this hobby becomes a professional place, it will always rank next to used car salesmen and shucksters.

I hear from people everyday who paid too much, or made bad purchases, and I bear the brunt of their complaints. I am not effected by these flea market sellers as they do not sell the same type of material that I sell, but when the average person looks at their purchase, I am effected.
With organizations like the ANA and PNG selling their names to the highest bidder, I am effected. This is where we need regulation. We need someone to step up and make our hobby/business professional.

This is a 10 billion dollar industry. Mark my words folks, this legislation will come. There is just too much money involved. I just hope that my efforts will fall into the scheme at some level.

I met with Senator Biden from Delaware today. He is considering a bid for the Presidency, and although I do not always agree with his politics, he is one of the most accessable Senators.
I have very little idea on exactly how to legislate the hobby/business as a whole, but I strongly believe that something must be done. You guys would not believe the number of people each day who contact me to only find out that their purchase was not good. It sickens me to the very core.
I could easily sit back and collect my money and care less (like most dealers), but I take this hobby very seriously. I want to be remembered not for being a dealer, but for making a difference.
Now granted, I always jump right in with the sharks, but if you want to make an omelet, a few eggs must be broken. I get run through the ringer for a lot of my comments about our hobby, but the squeaky wheel gets the grease.
There are plenty of good things within our hobby, and I am trying to get our elected leaders to build off of these things. While it would be next to impossible to get a standard grading guide, it should be attempted and regulated. The ANA actually had a good thought in grading the graders, but backed down to the powers that be. This tells me that each service does not clearly stand behind their graders. Until such a day comes to be, we will suffer with subpar service.

BTW, thanks for bringing up this topic. It is a good thread, and provided me with a little insight to discuss with the congressional leaders.

I think this whole thing in Ohio is certainly making it more likely that there will be fallout. I agree somewhat that there are segments of this 'hobby' that need looking into very heavily (TPGs, some of the large dealers, etc) but, having said that, I have little faith that the government can get involved with it without messing with it up even more. ;)

Either way, I can't see it affecting me or my collecting too terribly much. No one will ever confuse me or what I do or who I deal with as the coin 'industry'.

My limited experience with government legislation would have me think you could have this nightmare scenario.

"Licence coin dealers"
For a yearly recurring licence fee, paid to the government to regulate the industry, a licence will be issued. The fees paid would be used to set up an office and pay the wages of a bunch of public servants who will ensure that coin dealers are paying that yearly fee. You don't have a licence? You get fined. Your Late with your licence fee, pay an additional late payment penalty.

At the start the new governing body would bust a few larger dealers for not having a licence, which will scare most honest people into getting one. Once the licence income is pouring into the government they sit back and do nothing, unless you report someone to them as selling without the licence. Then they would send off a threat letter to get that dealer to pay for the licence or be faced with even more fines.
How would this protect you? Well if enough people complained to the governing body about the practices of a particular dealer, the governing body would send another threat letter to the dealer about having his licence revoked! Of course they would have to take him to court to prove he has done something wrong before they took such drastic action and it would take years to finalise. This would involve more costs, but the solution is simple, raise the price of the licence fee.

Would this system actually help you? That is not the point.
Look at all the good the regulations will have done.
The government would be proud that they got the industry regulated.
The government would pat itself on the back because they have created jobs.
The dealers would be happy because it got rid of the amateur / hobby coin dealer competition.
The Public would be fooled into thinking it was protected from fraud, which existing laws already cover.
And ALL COSTS would, of course, be passed on to the customer as higher prices, for protecting him from the unscrupulous.

Does anyone think I have become cynical in my old age? LOL

National Dealer..My hat's off to you for your efforts to steer any upcoming legislation..or at least making sure your opinion and those who share it are heard. I don't know what you are proposing and don't even know if I would agree with it. I have every reason to believe you are sincere and doing it for eveyone and not just yourself. Thank-you!

Some sort of Lemon Law would be nice. Professional graders? There's a bigger problem bubbling before coins even get to them. And that's Coin Doctors! Those who change a coins appearance in order to enchance it's "temporary" value for nothing more than profit to them! These guys are good! To be able to slip a coin past a TPG co. that's been tampered with is hard. But in time some one will get burnt when they are the ones owning it when it turns in the holder. Sure you can go back to the grading companies, but why should we have to even worry with such a thing to begin with!

WARNING!! The focus on coins has changed from a hobby to a industry. More and more people come into coins with $$$ signs in their minds. They might say and actually mean they like collecting coins, but a big portion for them buying is with the thought of how much will this coin be worth from tomorrow on so I can make some money on it. These are the people who fueled such a upward surge in the coin hobby. It wasn't all the collectors deciding to go on a buying spree at the same time. Why the warning? Because I think it's going to be one of these type coin buyers who will get royally ripped off, either real or imagined..either once or for the last time..and they will show up at a coin show. And they won't be looking to buy any coins either. Post Office meltdown at a coin show here we come. This scares holey manoley out of me! Metal detectors at coin shows?

I use to cringe at the thought a regulating the coin hobby/industry. This is flip flop of me, but I want to sell some coins for a bunch of $$$ down the road too!! I don't want to have to fill out a buch of paperwork! However, I'm going on record now. Whatever you want to call it, IT is out of hand. IT needs regulation. People are getting financially ripped off by the unscrulpulous. And in most cases there is no recourse.



Jerry

Being here in Delaware, I get a few calls each day from people who purchase from QVC and the other TV shows, a lot of internet sales, and a small percentage of shop buys. TV of course is the highest possible prices, usually 400% above retail. Internet sales tend to be mostly overgraded which of course means over priced, and I am seeing more counterfeits each week. While a huge chunk are coming from overseas, there are so many altered dates and mintmarks that are produced right here.
Twentycent mentioned coin doctors, and this is a trend that has been around for a while and is growing by the day. Not that I am picking on ebay (even though everyone knows that I do not like it), but internet auctions allow bad sales. Each online auction house has rules in place against selling counterfeits and altered coins, yet I can sift through each of them and find multiple examples. This is not only unethical, but totally illegal. These same companies stand behind the clause "We are only the venue". Well, many other types of businessess have used that logic and lost big time.
Now I am a coin dealer, but for those who know me, know that I buy and sell coins to allow me to pursue other avenues within the hobby. I work with children and community groups to further the hobby in a positive direction. I work with many congressional leaders to provide the resources needed for design change and laws to protect this hobby. I offer education programs to kids and adults through coin clubs and events around the nation. I have hard views on this hobby, and they may not be perfect or even correct, but I can forsee a very slim future for our next generation. We already have 1 coin that has a permanent design, and despite what anyone thinks, that is just plain wrong. Who are we to tell the future collectors what should be on their coins?
If nothing else, I am passionate. I make my views known without hesitation or waivering. Right, wrong or otherwise, I am trying to make a difference.

Now, with that said, here is what I have proposed to the group of congressional leaders:

Coin dealers need to be licensed within their state. (most do this already) However, this would include internet sellers and flea market vendors. You cannot practice law without a license, you cannot sell cigarettes without a license, and I believe that you should not be able to sell coins without a license.
Coin grading needs a standard that all are required to follow. Each TPG company uses a different formula and we all know that some are very subpar. A standard would at least be a start. A board could be formed to independently grade the grading companies.
Selling known counterfeit coins should have a minimum jail time. No fines, no excuses, just jail. The secret service claims that 8% of the coins sold online are counterfeit. That is huge. That equals to roughly 125 million dollars per year. That is serious business folks.

Now I personally believe that coin dealers need to be educated in a formal system, but I know that that is asking too much. There are a few colleges and universities that offer numismatic degrees, so it could be a future project

I am also beating the bushes to get Lady Liberty back on our coins, and fighting the idea of making all 6 coins permanent designs. Irregardless of how great our founding fathers are, they were NOT supposed to be on our coins, and they should not be on them now. That is why we have a commemorative program.
The law (statute one) is very clear on the subject of coins. All I ask is that congress gets their butts out of the design business. I am sure that there must be something more important for these fine men and women to worry about. If they cannot figure it out without a 10 year study, they can give me a call and I can offer a them a few ideas.
Let them fix social security, gas prices, unemployment, national security, taxes, crime, homelessness, minimum wage, high insurance costs, healthcare, and I am sure that I could come up with a few more things if I actually put some thought into it. They need to stop playing politics with my coins.