Buying Gold and Silver From Unknown Third Parties Poses Counterfeit Risks
No one likes paying something for nothing or being defrauded, especially when paying large amounts of money. Ever since gold and silver have been valued, counterfeiting of precious metals has existed. People often buy precious metals for insurance against bad outcomes. Here are some tips to make sure you receive genuine gold and silver for your money so that your gold or silver purchases don’t themselves turn into bad outcomes.
1. Buy Directly From a Reputable Dealer or Mint.
Buying your precious metals from a reputable gold or silver dealer or from sovereign or private mints is probably the best way to ensure that you metals are authentic. Popular bullion products from the United States Mint like American Gold Eagles, American Silver Eagles, American Gold Buffaloes and America The Beautiful Silver coins are not available directly from the United State Mint. Rather these products are sold to Authorized Purchasers who in turn sell them to bullion dealers.
Buying U.S. Mint coins from a bullion dealer helps ensure that you are buying genuine U.S. Mint coins that have not been counterfeited. Reputable dealers also test gold and silver coins, bars and rounds for authenticity that they buy in the secondary market. You can buy with confidence when you purchase your gold and silver from a reputable bullion dealer like BGASC.com.
2. Test Your Metals.
While there is no sure-fire way to guarantee that you are getting authentic gold and silver, here are some tests you can perform to increase your chances that you don’t buy counterfeited metals.
When you buy gold or silver from individual online sellers or in person, you will have to undertake to determine the authenticity of what you buy. The time to make the determination is at the point of sale. Finding out that your coins are counterfeit later may leave you out of luck as the seller may have vanished. There are a number of tests you can undertake to flush out counterfeits.
Size and Weight
You should weigh your coins to see if they match the amount stamped on the coin. Also check the diameter and width. A one ounce counterfeit coin can still weigh an ounce if the size of the coin is changed. Gold and tungsten have similar densities and gold plate can be layered on to near worthless tungsten. Using tungsten and gold plate, a counterfeiter can make a “gold” coin very close in look, size and weight.
Silver when dropped on a hard surface will make a distinct “ping” sound, distinct from a more muted sound that base metals like copper or nickel make.
Neither gold nor silver are magnetic. If a standard magnet latches onto your gold or silver you have a counterfeit. Rare earth magnets are useful in determining at least if there is some silver in your a coin as they will slide slowly across the surface if silver is present, but will slide more quickly when silver is not present.
Variance of Design
Compare the lettering, design and dates for any variances. A poorly counterfeited coin will lack some of the finer details of authentic coins. A good look with a magnifying glass in comparison to a known authentic coin or high resolution photo of a real coin can help spot fakes.
Some gold coins and bars may have red spots that appear to be inconsistent with real gold. This phenomena occurs, although many experts don’t know the reason. Red spot themselves should not be a sign of a counterfeited coin.
Some silver coins will have opaque white spot called “milk spots“. These spots are common and do not mean that the silver is counterfeit. The Canadian Mint supposedly has determined how to mint their coins such that they won’t eventually get milk spots, so Canadian Mint silver coins and bars of recent mintages that have milk spots should be treated as suspect as not genuine Canadian Mint products.
While American Gold Eagle coins are minted with Arabic Numerals as dates, Roman Numerals as dates appeared on American Gold Eagle coins from 1986-1991. (e.g. MCMLXXXVI for 1986) If your seller is selling a year 2000 American Gold Eagle coin with Roman Numerals, you will know it is fake. If you are being sold a 1987 American Gold Eagle with Arabic Numerals you will know its a fake.
Buy Sunshine Minting Gold and Silver rounds and bars of recent mintage.
The Sunshine Minting Company, a private mint and the Canadian Mint have begun minting their rounds and coins with anti-counterfeiting features. The Sunshine Minting Company offers a decoder designed to be used to authenticate their products. Holding their lens viewer over their coins, a “valid” mark will appear, indicating an authentic Sunshine Minting product.
There are also commercially available precious metals verifyers that can assist you in spotting counterfeits, like the Sigma Metalytics Precious-Metal Verifier pictured below.