It has been reported by a major media outlet, who deals primarily with those who have a numismatic leaning, that a new fake has been determined to be on the market. The fake in question has no collectible value. It is almost exclusively purchased for the bullion value and is most often traded in bulk. The coin is the Engelhard 1-ounce silver Prospector. It is not really a coin, it is actually a silver round. Engelhard was one of the most popular brand names of manufacturers of silver bars and rounds up into the mid- to late-1980s. Their 1-ounce round silver Prospectors are still highly desired by investors in physical silver, even though they have not been made for a quarter-century. But their name and quality has one that bullion investors have learned to trust and therefore Engelhards trade almost sight unseen. That is where the fake-o rounds come in.
These rounds would usually be under heavy scrutiny were they collectible coins but they’re not so all they have to do is pass a cursory glance and maybe a quick weighing on a scale accurate to the tenth of a gram. The fakes, which showed up in Florida, had the proper diameter and thickness and weighed only about 0.5 grams light. Such pieces would almost certainly fool the general public as well as dealers who did not pay close attention. The bad pieces contained about 60 percent copper, 39 percent zinc and a smidgen of nickel, which was then silver-plated. The surfaces were mirror proof-like whereas most Prospectors have a frosty satiny look. The fakes at the ANA all had the large “E” in the center of the reverse inside a globe (as appeared on earlier Prospectors) rather than the eagle that was used on later Prospectors. If a few of these were mixed in a large batch of silver rounds, they could easily pass from hand to hand without notice.
You’re thinking why do I care? Well here is the thing. This is not the first time in the last few years that fake bullion has turned up. there was a rash of fake gold bullion approximately two years ago. Turns out that several less savory individuals, mostly out of Eastern Europe were sliding tungsten bars into too light gold bullion to bring it up to weight at a fraction of the cost. This was a major concern for many bullion dealers and started to depress the price of gold. However a work around was discovered and the fakes became easier to detect.
Now, I don’t know if dealers are going to start inspecting each individual piece of bullion to detect fakes. It would certainly slow down the trade, but it would keep prices from becoming depressed and it would have the benefit of ensuring consumer confidence. In a monetary market in as much flux as ours has been with the dollar all over the place and precious metals on a roller coaster, we need all the stability we can get.