Gold & Silver PAC December 2016 e-Newsletter

Gold & Silver PAC

By Scott Barman for the Gold & Silver PAC …..

From the Political Coordinator

I have been working for the federal government as a contractor since 1996 making this the sixth general election I have witnessed alongside the career professionals working federal agencies. While it is against the law and employment policies to be involved with politics while working for the government and on government time, the emotions of the election always causes “leaks” in how people feel.

For the rank and file government worker, those whose pay scale is on the general schedule, they won’t experience many changes in the short term. Changes will come when new policies are enacted, defined, and someone figures out how they will be implemented. It could be over a year before the daily worker sees changes.

The people who are the most worried are the career executives who are members of the Senior Executive Service (SES). Members of the SES may have been career government employees or could have been special hires coming into the government from private industry to enhance the government’s management capabilities. Since most of these executives have direct or one-level away contact from the secretaries, commissioners, and other presidentially appointed directors, they are more concerned than others.

In congress, several of my contacts are on the staffs of outgoing members. Older staffers of members that did not run for re-election seem to have plans to retire from government service. Others are looking for jobs with new members. Now that the president-elect is proposing to appoint members of congress to his cabinet, members of those staffs have been asked to stay to help with a transition.

As for any of the pending legislation, do not count on anything controversial being passed. Given the results of the election, sources say that the partisan rancor is so fervent that even the most cordial relationships have turned icy. These feelings are not limited to cross-party relationships. There is a growing divide between ideological members in both parties that could almost split the congress into four parties and suggesting that the partisan bickering to escalate during the lame duck session would be an understatement.

Remember, congress passed a continuing resolution, not a real budget, in late September that will expire on December 9. If a budget is not passed by December 9 then the government will have to be shutdown.

It is almost guaranteed that the Marketplace Fairness Act (S. 598) and the Remote Transactions Parity Act (H.R. 2775) will die in committee.

Post-Election at the U.S. Mint and BEP

One immediate impact of the election results is that Rhett Jeppson will not be confirmed to become the Director of the U.S. Mint. Even though the Senate Banking Committee held a hearing for his nomination on March 15, the chance of the GOP-led Senate confirming any of President Obama’s appointment nominations are non-existent.

Jeppson was hired in January 2015 as Principal Deputy Director as a member of the government’s Senior Executive Service (SES) program. In July, it was announced that Jeppson would be nominated as the Director. Since the nomination will likely die in committee, Jeppson will remain on the U.S. Mint staff as a government employee. Although he has not announced his intentions, Jeppson is likely to continue as Principal Deputy Director.

The Bureau of Engraving and Printing (BEP) is not affected by a change in administrations because the position of the director is a permanent government employee. Len Olijar will remain Director of the BEP as long as he is a government employee in good standing and wants the job.

Counterfeiters Arrested in Peru

Peruvian police, working with the United States Secret Service, carried out Operation Sunset and seized almost $30 million in U.S. currency. The operation was carried out with more than 1,500 Peruvian police primarily in and around Lima.

Police arrested 48 people, closed six counterfeiting plants, confiscated eight presses, and seized more than 1,600 printing plates, mostly for U.S. currency. Police also seized more than 50,000 € in countrified currency.

Peruvian gangs that were in charge of this operation would use tactics similar to drug smuggling to ship the bogus currency to the United States. The main destination is the northeast corridor and private commerce. Larger institutions and the banks have the technologies to quickly detect these notes are counterfeit.

The U.S. Secret Service has recognized these Peruvian notes amongst the closest to being mistaken for the real currency. Since few people look for or understand the anti-counterfeiting measures including in U.S. currency, the note can go undetected until it has passed through many hands.

Field offices in New York and Boston continue to warn about Peruvian counterfeit currency still in circulation.

New California COA Law Projected to Hurt Small Business

In September, the California General Assembly passed Assembly Bill 1570 that any dealer selling to consumers in California, or who operates in California, that sells autographed memorabilia at a price exceeding $5 or more must provide a certificate of authenticity (COA) for the item being sold. The law specifies the content and typeface of the COA, that the dealer be bonded, along with maintenance of the documentation for seven years.

Problems with the law were noticed after the bill was signed into law by Gov. Jerry Brown (D). The first industry to take notice was the bookstore owners who use author signings to lure customers into their stores. As part of the signings, the author will sign extra books that will allow the store owner to continue to use them as a promotion to sell more books. Under this law, the small bookstore owner must provide a COA for each book sold.

Coin dealers may not be immune to the law’s problems. Dealers do carry author-signed books including the popular Red Book as well as certified coins with autographed inserts. Even with the narrowest reading of the law, a dealer selling a certified coin with an autographed insert will be required to issue a COA for that autograph. Currently, the grading services do not issue a COA separate from the encased coin.

One of the problems with the law is its vague wording, specifically the definition it uses for “dealer” leaves a lot open to interpretation. The law does exclude the autograph signer, pawnbrokers, and marketplaces like eBay. But it is silent on whether an out-of-state dealer is liable for selling to a customer in California.

Currently, Scott Brown of Eureka Books in Eureka, California is leading a “dealer assault” to have the law repealed or stayed until its impact can be studied further.

U.S. Mint Asks for Help with Mutilated Coin Program

On November 1, the U.S. Mint published a request in the Federal Register asking for comments regarding the Mutilated Coin Exchange Program to supplement the information it has already gathered. With no other notice, the U.S. Mint allowed for a two-week comment period that ended on November 15, 2016.

The U.S. Mint suspended the exchange program on November 2, 2015 to “assess the security of the program and develop additional safeguards to enhance the integrity of the acceptance and processing of mutilated coinage.” This came when the Mint alleged that a company in New Jersey was importing counterfeit coins from China to redeem as mutilated coins. That case is pending along with the civil case filed in October by members of the recycling industry.

According to the Federal Register report, “[the] Mint is considering include requiring participant certification, coinage material authentication, chain of custody information, and annual submission limitations.” They were seeking comment on that and other possible factors to better secure the program.

Summary of Numismatic-Related Legislation and government activity as reported by the Gold & Silver PAC

The lame duck session has begun and, as expected, there has been no work on any numismatic-related legislation.

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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

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