It’s Legal In China To Produce Counterfeit US Currency

Posted by Brian Lund in Just for fun, Trading

I have often mentioned on my blog that I am an “A-hole,” but what I don’t mention as much is that I am a “dork” as well.  Not a complete “Dungeons & Dragons dork,” but more of a “numismatic dork.”

That’s right, since I was a kid I have collected coins.  And the hobby that I love has been under assault over the last 10 years from an unlikely source, China.

China produces millions (yes, millions) of counterfeit US coins each year.  And this is not some shady back alley enterprise; It’s one fueled by massive factories, employing thousands of workers, all in broad daylight and with the knowledge of the Chinese government.  Oh, and it’s legal.

In China it is perfectly legal to produce pre-1949 US coins with no indication whatsoever that they are fake.

Fake US Morgan Silver Dollars

Dies For Counterfeit US Coin In Chinese Factory

Thousands Of Counterfeit US Coins In Chinese Factory

What started out as a nuisance is now becoming a serious problem and threatening the multi-billion dollar a year numismatic industry.  As technology improves, Chinese fakes are now even showing up in counterfeit grading slabs, and often experts have a hard time telling the real coins from the fakes.

So what is being done about it?  Surely Congress, the Treasury Department, or the Secret Service must be all over this right?  Wrong.  Up until recently, our government has done NOTHING to stop this problem.

There has been some weak-ass legislation (H.R. 5977: Collectible Coin Protection Act) recently introduced by Texas Representative Lamar Smith to try and address this issue. However,  Govtrack.US gives it an 8% chance of being enacted, and if it was, it still would do nothing to effect China’s domestic production.

I get that we have little influence on other countries when it has to do with drugs, which even in their native countries are illegal and are produced by clandestine outfits.  And I see the logic as to how fake Gucci bags and consumer goods may not be our government’s top priority.

But the actual open production of counterfeit US currency, which even pre-1949 is considered legal tender?  WTF…???

That’s it. That’s all I got.  It just makes me so mad I want to huck a handful of 1909-S V.D.B. Lincoln cents at someone.

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  • http://twitter.com/JFinDallas JFinDallas

    Oh well, they have been buying pieces of paper from our treasury with real money for years, they have paper but we have the money, so even if they send over a little bit of fake currencies we are still ahead… ;-)

  • http://kiddynamitesworld.com Kid Dynamite

    huck the 1909-S VDB’s at me!

    • http://bclund.com/ bclund

      LOL…..

  • http://www.stocksage.net Robert Sinn

    Are the Chinese fakes made from real silver or are they silver plated or worse?

    • http://bclund.com/ bclund

      It varies. They are often made of “German silver” which is an alloy that contains no silver. It is usually 60% copper, 20% nickel, 20% zinc. Those are the ones people will not see before they buy, like on Ebay or other online sellers.

      The really good ones, designed to be “close up” fakes are made with real silver. It is a good trade, $40 worth of silver to try and get a sale in the thousands or tens of thousands of dollars.

      The problem is made even harder now that they are seeing fake coins in fake PCGS, and to a lesser extent NGC, grading slabs.

  • http://www.facebook.com/lovebob Robert J. Love

    Am guessing this is counterfeit technology transfer from North Korea and vice versa.

    • http://bclund.com/ bclund

      I would not doubt that, but the Chinese have the technology and skills to do it on their own.