Wednesday, May 12, 2010

80 Year Old Man Loses Life Savings AFTER "SELLING" his coin collection -THE SHOCKING TRUTH

An 80 year old man lost nearly his entire life savings SELLING his vast coin collection. Read the shocking story of "Bill Johnson"(name changed to protect his identity), who after selling his entire coin collection, lost nearly his entire life savings.

Investing in rare and valuable coins is supposed to be a great way to diversify your portfolio, right? A wise choice to invest in hard assets. Gold, Silver, and Platinum are at all-time high prices. So how did Bill Johnson lose nearly his entire life savings "investing" in rare coins, limited edition numismatic collectibles, gold, silver, and platinum coins?

Here's the scenario. Bill is a retired gentleman, and has been purchasing what he thought were rare, limited edition, and valuable coins and collectibles for many years. Coins made of Gold, Silver, and Platinum. Buying coins with very limited quantities, after being informed that these would be valuable for generations to come, and only available for a very limited time, never to be released again. Something special, he was informed, to pass on to future generations. Bill thought he was making a sound and wise investment. So how did Bill lose his entire life savings when he sold his collection? Did the coin dealer he sold them to "screw" Bill out of his coins? Did someone steal them? How does one lose money when they sell something?

Bill Johnson purchased his entire coin collection from the Home Shopping Networks, QVC, Franklin Mint, American Mint, Morgan Mint, and the United States Commemorative Gallery, and other similar online and television shopping networks, and from the numerous catalogues these companies solicited him through the mail. After all, these were supposedly reputable companies, with well-known spokesmen, with years and years of experience, and some have been in business for decades. How in the world did Bill lose all his money?

Very simply put, Bill paid too much for every single item he bought. Way too much. In fact, some of the items Bill bought were absolutely worthless. And lest you think Bill got screwed by the dealer who bought the items from him, Bill brought his items to several dealers, and all of the offers Bill received were less than 1/10th of what he actually paid for the items originally. For example, one of the items was a Statue of Liberty, limited edition, commemorative coin, layered in Gold, from the American Mint. Bill paid almost $90 for this limited edition coin, touted by the American Mint as having a mintage of only 50,000 pieces. Bill thought he was getting a good deal. Especially after hearing advertisement after advertisement and program after program by the home shopping networks of the rising price of gold. In fact, the spokesmen have gone out of their way to stress gold prices, and the fact that these coins are layered in PURE 24K GOLD. So they must be valuable right?

Well, this particular example of the Liberty Commemorative Coin Bill bought is made of copper-nickel layered in Gold, but what the American Mint and Home Shopping Networks and all of the other companies Bill bought his coins from DO NOT TELL him or any other customer, is that there is less than 2 CENTS worth of gold in these coins. Not only do these places emphasize the rising price of gold, they stress the limited quantities and availability of these items. Available at these low prices for a limited time only!

This Liberty Commemorative coin has a metallic content value of less than .25 cents, which is all it is really worth. It isn't even a US Government issue coin. It isn't even legal tender. It is a nearly worthless medal slug, minted by a private corporation, for the purpose of making a profit for itself at the expense of uninformed buyers, who have been seduced by assumption-inducing tactics, plain and simple. Bill Johnson didn't get screwed when he sold his coin collection. Bill got screwed when he bought them. Bill spent tens of thousands of dollars on items that were worth less than a penny on the dollar.

Another one of the gimmicks some of these companies use is to Silver, Gold, or Platinum plated, regular issue US coins. Bill had a collection of Gold and Platinum State Quarters, and New Presidential Dollars that he purchased from a few of these companies. The Presidential Dollars were being sold for $9.95 each, and touted as an unbelievable bargain. Really? They take a regular issue dollar, and plate it with less than 2 cents worth of gold or platinum, and sell it to an unsuspecting customer for almost $10 dollars?

And those State Quarters? They will be worth a quarter for lifetimes to come. They minted billions of them. Gold plated, silver plated, platinum plated, makes no difference, the additional plating is worth less than 2 cents.

But Bill isn't alone. There are countless people falling for the sales pitches of companies like the Franklin Mint, American Mint, and the Home Shopping Channels. Billions of dollars are being bilked from under-informed buyers like Bill every year.

So Bill Johnson did lose his entire life savings of tens of thousands of dollars by purchasing what turned out to be face-value items, or worse, absolutely worthless metal slugs containing pennies worth of precious metal, simply by slick, and purposely misleading statements and advertising.

One of the easiest ways to prevent this from happening to you, is to simply ask the company you are thinking of buying an item from, what their return, or buy back policy is. If you are purchasing any coin, or numismatic item, a reputable company will ALWAYS purchase or repurchase the items from you, or at least give you an appraisal of those items. Especially if originally purchased from them. Beware of any company that offers only a 30 day refund, and especially beware of any company that will NOT buy back any of the items they sell, or refuse to appraise the value of those items. That is a warning sign that they are truly worthless.

For example, I personally sent an email to the Franklin Mint requesting information about their return/buyback policies. This is what I received back:

"Thank you for your email.

While our policy is to accommodate our collectors' requests whenever possible, the Franklin Mint does not buy back collectibles. Please also note that The Franklin Mint offers a 30 day cancel/return policy.The Franklin Mint does not have the facilities to appraise, evaluate, or track the aftermarket value of our products. Due to constant fluctuations in the collectibles market, we are unable to quote current prices. Nor do we recommend or endorse any agency or company in the secondary market. We hope this information has been helpful.

Sincerely, Elizabeth Jennings
Customer Service
Franklin Mint"

So these companies are more than willing to sell you these "valuable" items, but unwilling to buy them back, and go so far as to refuse to offer any valuation of the items. RUN RUN RUN away from any company that cannot stand behind the products that they sell.

The lesson here is to be an informed buyer. Don't buy anything from any company that is unwilling to buy the items back. A true investment is one that you are able to buy, and sell easily and quickly, and although there are never any guarantees of future value, buying from a reputable dealer who will offer a free appraisal of the items, will certainly be a big help.

Charlton Coins will always repurchase the items we sell, at fair market prices. While no investment is guaranteed to have a high rate of return, our professional team of experts can certainly help you avoid costly mistakes and steer you in the right direction to make informed buying decisions.

Charlton Coins - A leading buyer and seller of coins, coin collections and estates, silver, gold, and platinum bullion. 508.335.6788

1 comment:

ahnn said...

That was very sad. It's really a great lesson for everyone. You should be careful in any transaction you are doing when involving money.

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