Third-party grading

Third Party Grading (TPG) refers to coin grading, authentication, attribution, and encapsulation by independent certification services. These services will, for a tiered fee, "slab" a coin. Professional Coin Grading Service (PCGS), Numismatic Guaranty Corporation (NGC), Independent Coin Graders (ICG), and ANACS are the most popular and credible services. Together they have certified over 80 million coins. All four firms guarantee the grades and authenticity of their certified coins. Certified Acceptance Corporation (CAC) is a coin certification service which certifies -- and makes a market in -- certain high-end coins already certified by PCGS or NGC.

First-generation PCGS slab

History

Early ANACS photo certificate, issued with the certificate below

Authenticity certificate for coin in above photos

Third party coin certification was pioneered by ANACS, which was founded by the American Numismatic Association (ANA) in 1972. The Board of Governors realized the need to have a guarantee of authenticity, so they offered the first authentication service. At that time, the coins were not graded, only confirmed as genuine. Coins were returned with a photo certificate but not encapsulated.^[1][2]

In 1986, PCGS began operations, providing encapsulation with a plastic slab now known as its first-generation holder (aka Old Green Holder [OGH] or rattler, because of its label color and the fact that coins would rattle inside.) NGC commenced business in 1987. Other companies have provided similar services but most are no longer in business and all have certified far fewer coins.^[3][4][5][6]

Leading services

There are four coin certification services which eBay, the largest coin marketplace, deems acceptable to include in its listings: PCGS, NGC, ANACS, and ICG. Experts consider these to be the most credible and popular services. Together they have certified over 80 million coins.^{[7][8][9][10][11][12]}

In 2007, the rare coin industry's leading dealer association, the Professional Numismatists Guild (PNG), released the results of a survey of major coin dealers who gave their professional opinions about 11 certification services. PCGS and NGC were rated "Superior" overall, with ANACS and ICG deemed "Good". PCI and SEGS were listed as "Poor", while called "Unacceptable" were Accugrade (ACG), Numistrust Corporation (NTC), Hallmark Coin Grading Service (HCGS), American Coin Club Grading Service (ACCGS), and Star Grading Services (SGS).^[13][14][15]

NGC and PCGS counterfeit holders have been reported, but significant measures have been taken by both services to remedy the problem, such as NGC's use of photographic verification for every coin certified and both services' employment of serial number verification and anti-counterfeiting features in their holders.^{[16][17][18][19]}

Process

At each of the four main grading companies, a similar process is used. Each coin is graded (on a verbal and numerical scale from 1 to 70) and authenticated by two or more graders, and then assigned a final grade by a finalizer, based in part upon the recommendations of the prior graders. Depending on the company, various descriptors may be added, such as Full Bell Lines (FBL) for Franklin Half Dollars or Deep Mirror Prooflike (DMPL) for Morgan dollars, and the coin's die variety may be noted. The coin is then slabbed and returned to the customer.^{[20][21][22][23][24][25]}

CAC

Certified Acceptance Corporation (CAC) is a Far Hills, New Jersey coin certification company started in 2007 by coin dealer John Albanese. For tiered fees of $12.50 or $25, the firm evaluates certain U.S. coins already certified by Numismatic Guaranty Corporation (NGC) or Professional Coin Grading Service (PCGS). Coins which CAC deems high-end for their grades receive green stickers. Coins which are at least high end for the next grade up are bestowed gold stickers. Coins considered average or worse receive no sticker. CAC maintains a free online Population Report and slab serial number verification service. Studies suggest that CAC-certified coins trade for premiums. Coins must be submitted to CAC via authorized dealers. CAC buys and sells CAC-certified coins via their affiliated trading network, Coinplex.^{[26][27][28][29][30][31]}

References