DGS grading?

I know that David Hall states that they do not submit any coins directly to PCGS. But I also noticed for the longest time that whenever a new finest known made the news it was always in David Halls inventory, and there were reports from people who were lucky enough to make top pops that they had received calls offering to purchase the coins before they even arrived back from PCGS.

 

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I'll tell you the more I read about PCGS the more I don't like them!! I would be so mad if I got a phone call with someone trying to buy my coin before I even had the coin back in hand. To me that is so unethical I cant even tell you how much it bugs me.

 

How is it unethical, and why does it bother you?

It's an offer -- take it or leave it. But unethical? I don't follow...Mike

 

It is just my opinion.

IMO it is a conflict of business interest. If they are willing to call to make offers what is to say they won't pull the whole coin switch a ru on you.

The graders should grade the coins and then have them slabbed. No one should know your personal information through or after the grading process.
It is just like graders grading dealers coins better than the avg. joe's coin.

 

I think what may be rubbing schatzy about it is that for all intents and purposes, the TPG could do it this way:

Step 1) Coin is definately one of the best TPG has ever seen.

Step 2) TPG calls owner and informs him that the coin has (conservatively) graded MS-67 and offer to buy the coin.

If the owner says no, they slab it MS-67 but if he sells they then re-grade it more loosely and it makes MS-68. This gives them a distinct advantage towards profiting from the coin. This is what I think might be rubbing schatzy, or others but it is merely speculation on my part. I don't suspect this, however IMHO it does point to exactly why TPGs should not sell coins.

 

Thank You!! That is what I was trying to get at!!

TPG's should not sell coin I agree 100%

 

I think it is entirely improper for a grading company to contact a submitter in order to try to buy his/her coins. If nothing else, it fans the conflict of interest flames. And in addition to that, they shouldn't be in an advantageous position over other potential buyers of the coin based on what amounts to inside information.

 

And you are certainly entitled to it -- I was just wondering how you got to that conclusion....because I just don't see it.

I'm sorry, but that's not a rational conclusion. How does the fact that they will make an offer on coins suggest they will switch (steal) your coin? I'm sorry, but it just doesn't make sense.

As I understand things, nobody does know whose coins they are during the grading process. And that's just how it should be if you ask me.

However, someone must know your personal information after the grading process or how would they what address to put on the return package?

Again, don't confuse what happens BEFORE grading with what happens AFTER grading.

 

Now that's an angle I didn't think of.... Hmmm....

 

Taking this thought another step...

Hypothetically speaking, if I send you a coin, Mark, to send to the TPGs, would it be wrong for you to make an offer to me on the coin before/after it went to the TPG? If so, how does this differ from the TPG's perspective? Does the fact that you are distinct from the TPG make THAT much of a difference in the ethical course of action?

Just some food for thought....Mike

 

Mike, the TPG has something to say about the ultimate grade of the coin. The coin is not what it is until the TPG grades it, therefore they have the very first opportunity to offer on the coin literally before it is on the market. This is where the two differ. The TPG should not have a dog in this fight. They should be impartial arbitors. The dealer who submits it OTOH, has nothing to say about the final grade.

 

Good questions, Mike.

I think it would be a bad idea for me to try to buy the coin from you before it got graded. Unless we both had the same opinion of the coin AND it later received that grade from the grading company, one of us would end up a loser and the other, a winner. Personally, I wouldn't want to be in either of those positions with a client.

After the coin had been graded, I would have a different answer, BUT, if I believed that it was under-graded I would feel compelled to discuss that with you.

The above notwithstanding, I feel that the main/important distinction is that the grader of the coin isn't also the (potential) buyer.

 

And as I understand things, the ones doing the grading aren't the same ones who are making the offer -- so there is a firewall, if you will, between the graders and the one making the offer.

 

OK, so suppose the coin is fairly graded and you make an offer. How is this any different than the TPG making the offer (presuming the one making the offer isn't the same person who graded or finalized the coin).

Clearly there's an appearance of impropriety when someone (DH) at the TPG makes the offer, but are the situations so different?

I'm not so sure they are...Mike

p.s. I agree 100% with your main/important distinction, but that's not what is really going on here.

 

I think there is a big difference, though it is largely about perception and conflict of interest.

If someone with a tie to a grading company makes an offer, he must have access to grading results. And in theory, could be in a position to influence those results, one way or another.

Even if that doesn't happen, however, if a grader is passing on those results, perhaps either knowingly or unknowingly, he isn't being objective in his evaluation of the coin. I'm not saying it happens, but a submitter shouldn't even have to consider the possibility.

 

If you believe the grading process is impartial and free of inside/outside influence, I don't see how the issues are any different.

However, as you suggest Mark, it is the perception that matters here and perception IS reality. So I do understand where you're coming from.

Let's take it another step....

Should people who are employees of TPGs even be allowed to buy and sell coins? Or is the appearance of impropriety too great to overcome?

Clearly the market today doesn't see a problem with it, but if you use your logic (perception and perceived conficts of interest), then perhaps we should be wary.

Just some more food for thought...Mike (who believes that TPGs should not be involved IN ANY WAY in the buying/selling of coins if they would like to be viewed as impartial)

 

Well I would hope that usually a persons submission is kept together. As for what address to put on the package that would be printed by the computer so the person who scans to package and puts the address on it doesn't have to know what is in it, and the person who packs it doesn't have to know who it belongs to. The only person who might have any reason to know what the coins are an who they belong to is the person who accepts the submission and enters it into the computer. And he has no idea what the final grades will be.