Mint to Crack Down on Fake Coin Peddlers

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Concerned that all that glitters is not gold, the U.S. Mint (search) wants to crack down on unscrupulous coin dealers passing off fake commemorative coins (search).

Mint officials said Tuesday they will seek authority to impose stiff fines on scam artists who are bilking the public by selling coins that have been painted or otherwise altered as official commemorative coins.

"We regard the problem as significant for new collectors, for the elderly and for those who are buying coins to give as gifts," Mint Director Henrietta Holsman Fore said in an interview with The Associated Press.

The popularity of coin collecting has soared in recent years as the Mint has offered new products such as the 50-state quarter series, which the Mint estimates 140 million Americans are collecting.

The problem, Fore said, is that the resurgence in coin collecting is also bringing out fraudulent operators.

"Congress is the only group that can authorize a commemorative coin and the United States Mint is the only entity that can strike them," Fore said. "It is sad to think that customers, especially the elderly, will fall victim to deceptive advertising."

Mint officials said that one business had been offering a "commemorative" coin to honor the astronauts who died in the Columbia Space Shuttle accident (search). The coins were, in reality, just silver dollars that had been colorized, something that is not done by the Mint.

In another case, New York Attorney General Eliot Spitzer (search) in October took legal action against a company that was selling what it claimed were commemorative coins minted from silver recovered at Ground Zero of the Sept. 11 terrorist attacks (search).

The Mint is seeking authorization to impose civil fines of $5,000 for each print advertisement and $25,000 for each broadcast advertisement that misuses the name or emblems of the Mint or the Treasury Department.

Mint officials said the amount of the fines depends on how large an ad campaign a company runs. They said they hoped publicity over the government's efforts to recover civil penalties would discourage coin dealers from placing deceptive ads.

"It is not just the fines that can hurt a company. The public attention can cost millions of dollars in lost profits," Fore said.

The proposal for the fines was to be published in the Federal Register (search) this week for 30 days of public comments the Mint will consider before it implements the final rule.

For coin buyers, especially new collectors, who question whether the products they are considering are legitimate, Fore said the Mint has a section of its Web site devoted to consumer tips.