Simple Steps to Protect Yourself from Gold Fakes and Forgeries
Every few months we hear another story about a crime involving precious metals. Another one came along last week, when the Metropolitan Museum in New York packed up a golden Egyptian coffin it owned and shipped it back to Egypt, from where it was stolen in 2011. The Met acquired the coffin in 2017 from an antiquities dealer. The only problem was, it still belonged to Egypt. (You can read the full story in “Ancient Gold Coffin Returned to Egypt from New York as Looted Antiquity,” an article that was published by the Associated Press on September 25, 2019.)
Why Are There So Many Crimes that Involve Gold?
There are many reasons. Here’s a short list:
Gold is valuable. That might sound like an obvious observation but stop to think about it. Because gold is rare and valuable, there is a lot of incentive to steal it or engage in other criminal activities involving it.
The history of individual gold items can go back hundreds and thousands of years. Who knows how many people have owned the gold coffin that the Met returned? It is about 2,100 years old. It was made to hold the remains of a priest named Nedjemankh. How many people can own one object over a span of 2,100 years? An awful lot, and that can confuse the question of who really owns it.
Political and national boundaries might have changed since a gold or other precious metal artifact was made. Over the last few decades, for example, we have heard a number of very sad stories about precious items that the Nazis stole. Many of those items are now being returned to the Jewish families from which they were stolen, which is very positive. But the stories of these stolen items are often complicated, and often impact on the question of ownership. Let’s say, for example, that you honestly buy a piece of jewelry from an honest dealer who, like you, does not know that it was stolen from a Jewish family by the Nazis. And let’s further assume that the heirs of that family then lay claim to it, and rightfully so? The questions concerning who really owns a valuable item can become extremely complicated and contentious, even when all the parties concerned are eager to do the right thing.
Gold is changeable, malleable and untraceable. Let’s say that a criminal syndicate obtains a quantity of stolen gold jewelry and wants to conceal its identity and sell it. With gold, that is easy. Items of gold jewelry, for example, can be melted down and fashioned into new bullion bars or new pieces of jewelry that contain gold that cannot be traced back to its source. This is one more reason why crimes involving gold have been so commonplace over the centuries.
Demand is high. Thieves who fashion gold into some new form are not going to have a problem selling it, because demand for the metal is so high. That too is an incentive that keeps dishonest people attracted to crime involving the metal.
What Items Are Most Likely to Be Fakes or Forgeries?
Don’t lose money buying fakes and forgeries. Here are some items to be on the lookout for:
Items that are stamped with karat gold markings, but which are only gold-plated. You buy a gold religious medal that is stamped “18K”, but it is really made of silver that has been covered with a thin plating of gold. You overpaid and lost a lot of money.
Counterfeit gold coins and bullion bars. They come stamped with the identifiers that can be found on legitimate pieces and are packed in the correct kind of plastic containers. The problem is, they are really made of iron slugs that have been given a thin gold plating. You got taken if you bought these.
Fake nuggets. They look like gold nuggets that were taken from streambeds in the Yukon. And because natural gold nuggets do not have karat stampings, it is easy to think that you have found the real thing – a chunk of gold that was found in nature. The problem is, it could be gold that has a very low karat rating because it was mixed with copper (to retain the yellowish color of real gold) and which is worth much less than it appears. Fake nuggets are easy to make! If you melt down some metal and throw it into a pail of water, you will get a natural-looking nugget that is anything but.
Collectibles of other kinds. In the world of jewelry, there are many kinds of items that are worth more than the precious metals they contain. A genuine classic watch by Breguet, for example, could sell for $10,000, despite the fact that it contains only $3,000 worth of gold in its case. It is worth more because of its collectible value. That all sounds positive until you consider the fact that forgers can fashion a fake Breguet that is worth only a few hundred dollars and then sell it for thousands. Creating forgeries that look like items that have high collectible value is another way crooks make money.
Don’t Fall for These Fakes!
To protect your investment, buy collectibles from reputable dealers who have been doing business in one location for long periods of time. Before you buy, demand to have your purchase inspected by an independent expert who will verify what it is. And if you are investing in an item because you are counting on its precious metals, call us first at 800-426-2344 and ask our advice.
We are here to offer guidance on how to navigate the exciting – and sometimes perilous – world of precious metals.