By Scott Barman for the Gold & Silver Political Action Committee …..
From the Political Coordinator
This past month, I had the opportunity to visit Capitol Hill. Rather than speaking with the members, staffers, and other policy wonks, I had the opportunity to sit with old friends who work in the agencies that supports congress behind the scenes. While not on the front line, these organizations hear a lot of the background chatter.
In between entertaining stories about members and their staffs, I asked for their opinions about the difficult legislation in front of congress. After they stopped laughing they explained that most legislation is difficult for this congress.
Aside from discussing information security issues that congress is debating, the major topic was the budget. The federal budget generates the most interesting stories and the most frustration for those working behind the scenes. Even though there was an agreement earlier this year, it did not surprise these people that the extremist members of congress are continuing the fight. Nobody will be surprised if the previous budget deal falls apart.
As I asked about other legislation each person was not optimistic that any controversial issue would even be heard in committee.
Congress hears about Internet Sales Tax from the small business perspective
After the American Supply Association, National Retail Federation and the U.S. Chamber of Commerce started a lobbying effort to convince the House Judiciary Committee Chairman Bob Goodlatte (R-VA6) to allow the Marketplace Fairness Act (S. 698), eBay began to weigh in on behalf the small businesses that use eBay.
Following meetings with members of congress, Hal Lawton, Senior Vice President and Head of eBay’s North America Business, wrote about his message in The Hill. Lawton’s message is that adding interstate sales tax collecting compliance to a small business’s requirements will be an additional barrier to their success. Larger businesses have the resources to absorb a new regulation but could be a significant burden to smaller businesses.
When speaking with a House Judiciary Committee staffer I was told that it is unlikely that the committee will hold a hearing until the Senate acts on S. 698. There is no incentive for the committee to work on this issue without a bill to discuss.
Ohio legislature taking up numismatic sales tax exemption
After being introduced in November, the bill to restore the sales tax exemptions for coin and bullion sales has been placed on the calendar.
Ohio reversed the exemption following the conviction of Toledo-area coin dealer Tom Noe who lobbied for the exemption. Noe is serving an 18-year prison sentence as part of his conviction for stealing funds from the Ohio Bureau of Workers’ Compensation Funds when he was managing their rare coin investments.
Originally scheduled for a vote in December, it was tabled because of a veto threat from Governor John Kasich (R). In order to gain Kasich’s support, amendments were introduced to protect the state and other institutions from the crimes committed by Noe.
Although the amendments have yet to be published on the Ohio legislature’s website, a source reports that the protections should not affect legitimate coin and bullion dealers in the state.
A vote should be held sometime in May.
FTC issues draft rules to enforce Collectible Coin Protection Act
The Federal Trade Commission (FTC) has published draft rules to account for the updates to the Hobby Protection Act (16 CFR Part 304) made by the passage of the Collectible Coin Protection Act (Public Law 113-288).
The FTC is required to publish the new rule in the Federal Register (81 FR 23219) and ask for public input on the new rules. These rules are the result of corrections made after a previous draft asked for comments on the costs, benefits, and overall impact of the rules.
The Federal Register entry with the published proposed rule from the FTC is available from http://1.usa.gov/1ru569X.
A PDF copy of the Collectible Coin Protection Act can be downloaded from http://1.usa.gov/1NUoHdd.
Comments can be made on the FTC’s website at https://ftcpublic.commentworks.com/ftc/hobbyprotectionrules/ or via postal mail as outlined on the website and in the Federal Register.
U.S. Mint extends suspension of coin exchange program
Following the arrest of Chinese nationals in California and New Jersey attempting to defraud the U.S. Mint coin exchange program using an allegedly fraudulent coin recycling scheme, the U.S. Mint suspended the Mutilated Coin Redemption Program pending review. Even though those indicted had not defrauded the government, Treasury officials decided to suspend the program in order to strengthen its security.
The original six-month suspension was set to expire on May 2, 2016. The U.S. Mint has renewed the suspension for an additional six months, and will now expire on November 2, 2016.
In related news, the consulting company FormerFeds Group, LLC issued a White Paper with their analysis of the U.S. Mint Mutilated Coin Redemption Program that includes recommendations to fix its problems. Since the White Paper was unsolicited by the U.S. Mint they had no comment.
A copy of the White Paper “Mutilated Coin Redemption Program – United States Mint” can be read here.
An executive summary of the White Paper was published by Coin Week and can be read here.
Counterfeiting on the rise
During my search of the web for numismatic-related stories that do not appear in the regular numismatic press, there is a distinct rise in the number of stories regarding counterfeit coins.
Europe is experiencing a rise in counterfeiting circulating coins that governments are saying is causing additional damage to economies. Coins that are experiencing a rise in counterfeiting include the British one-pound coin that will be replaced in 2017, the Swiss 5 franc coin, and the 2-euro coin. While the source of the British counterfeits remain a mystery to law enforcement, reports suspect that Swiss and euro coins are being manufactured in Italy.
In the United States a new wave of collector coins and bullion have been seen in the market. The Professional Numismatists Guild (PNG) is reporting that following a survey of its member dealers the number of counterfeit coins now on the market is on the risk. In addition to the counterfeit coins many are appearing in counterfeit grading service holders. While an experienced collector may be able to detect most counterfeit slabs, there have been novices who have been fooled by these fakes.
According to PNG, two members who recently were in Asia say they saw counterfeits of Draped Bust, Seated Liberty, Morgan and Peace silver dollars being sold in flea markets in China and Hong Kong for $1 to $3 each. Some are brought back to the United States where they are submitted to third-party grading services where they are returned as counterfeit.
Many of these counterfeit coins have flaws that someone with experience with these series would easily detect. PNG advises everyone that if you are not sure about the coin, collectors are advised to consult with a PNG dealer who can provide a proper analysis.
Summary of Numismatic-Related Legislation
Sen. Bob Casey (D-PA) introduced the United States Semiquincentennial Commission Act of 2016 (S. 2815). This bill is the same as H.R. 4875 introduced in the House by Rep. Patrick Meehan (R-PA7) in March. Both bills seek to create a commission to celebrate the nation’s 250th birthday in 2026 similar to the bicentennial celebration of 1976. It is common for bills like this to be introduced in both chambers hoping one will be passed.
S. 2890: A bill to require the Secretary of the Treasury to mint coins in recognition of Christa McAuliffe.
Sponsor: Sen. Kelly Ayotte (R-NH)
Introduced: April 28, 2016
Referred to the Senate Committee on Banking, Housing, and Urban Affairs
This bill can be tracked at https://www.govtrack.us/congress/bills/114/s2890.
H.R. 2722: Breast Cancer Awareness Commemorative Coin Act
Sponsor: Rep. Carolyn Maloney (D-NY12)
Introduced: June 10, 2015
Passed the House on June 15, 2015
Passed the Senate on April 20, 2016
Signed by the President on April 29, 2016
Read the about the new law at https://www.govtrack.us/congress/bills/114/hr2722.
If you have any questions or comments, please feel free to contact me at [email protected]. “Letters to the Editor” are appreciated and may appear in a future newsletter.
Scott Barman, Political Coordinator for the Gold & Silver PAC
Barry Stuppler, Chairman Gold & Silver Political Action Committee