Our Comprehensive Guide To Detecting Counterfeit Gold Coins
One major risk of buying bullion coins is the possibility of fake coins. Even in this age of technology and security, counterfeit coins still proliferate on the market. They’re even more valuable now since gold coins are treated as collector’s items or investments.
Since gold coins are a massive investment, you should know how to tell fake coins from real ones. Getting a fake coin means money down the drain in so many ways, so we’ve written this guide to help you avoid being taken in by counterfeits.
Read on to learn how to detect counterfeit gold coins and test whether your bullion is real or not.
How To Detect Counterfeit Gold Coins
There are many gold coin counterfeit detection methods. We’ll break down the steps and details you need to look out for below:
Sound: Ping Test
This is the easiest way to detect counterfeit coins. When gold hits a hard surface or another gold coin, it produces a distinctive and clear ping sound that lasts for a while. Meanwhile, a counterfeit coin will have a more muted and dull sound that doesn’t last as long.
However, for your comparison to be accurate, you need to have heard the sound produced by an actual gold coin first.
Fit: Stack Test
This is a fairly easy test, but you need to have other gold coins of the same type you’re testing. Stack the suspect gold coin with confirmed real coins of the same type. If this results in a solid, balanced stack with no significant differences, it’s probably a genuine coin. If you get an unstable stack, there are odd bumps, or the coin sticks out, that’s a warning sign. Look into the suspect coin and confirm it with other tests.
Magnetism: Magnet Test
This is a fairly simple coin test, but you’ll need a neodymium “super magnet” for this. Gold is not magnetic, unlike most metals that counterfeiters use.
Take the suspect coin and hold it at a 45-degree angle. Then, put the magnet on. If it sticks, it’s not real gold. If it slides off, then it may be real gold.
That said, counterfeiters today are familiar with this method and sometimes use non-magnetic metals to make coins. If the magnet stays on, it’s definitely a counterfeit. However, a coin passing the magnet test does not automatically mean it’s a genuine gold coin. The magnet test is simply a jumping off point – keep checking the coin with other tests to get more accurate confirmation.
Conductivity: Ice Test
There’s a reason some computer parts are made of gold – gold is an excellent conductor of both heat and electricity. This conductivity can also help you determine whether a suspect coin is real gold or not.
You’ll need a genuine coin of the same type as your suspect coin. Put an ice cube of equal size on top of each one. Real gold, being really conductive, will melt the ice cube faster. If the ice is slow to melt, it may contain other metals.
Dimensions: Scale And Callipers
Mints have to adhere to strict regulations ruling the size and weight of coins made with precious metals. Counterfeit coins typically substitute some of the gold content with another precious metal (e.g. copper or palladium), which will mess up either the size or weight.
For this test, you’ll need precise measuring equipment, including a scale to measure weight and callipers or a micrometre to measure dimensions. Look for models that go up to three decimal places to ensure you get precise results. Also, familiarise yourself with the standard weight, size, and shape of the original coin so that you can compare them to the measurements of the suspect coin.
Features: Visual Inspection
This method is the least invasive way to authenticate a gold coin and the only method that doesn’t require the actual coin to be in front of you. That said, you’ll need a good eye and a familiarity with the coin type you’re examining or an authentic coin that you can compare the suspect coin with.
These days, the minting process is largely automated and computer-controlled, and the coins produced are virtually identical to each other. With a lot less margin for error, modern coins are a lot more difficult to fake. However, older coins were produced by handmade coin dies, so there may be slight differences in one coin type if more than one die was used to make the coins.
A full and thorough analysis of a coin’s details, such as on an American gold eagle is best done by someone with professional experience. However, you can still do a basic visual inspection with a magnifying glass or jeweller’s loupe. It also helps to have a genuine coin so you can compare it with the fake side-by-side – this will help you match coin details.
Real coins are usually crisp and clear, with clean, smooth surfaces. Be suspicious of soft, “mushy” letters and logos. Also, look out for coarse surfaces lacking detail. Both of these are signs of a counterfeit coin.
Of course, you can always have the coin assessed by a professional. They’ll have the right knowledge and experience to declare conclusively whether a coin is real or fake.
Specific Gravity: Displacement Test
This is a bit involved, but it’s quite conclusive. Displacement tests have quite a long history going back to Ancient Greece, developed for the exact purpose of determining whether a golden item was fake or not. You can weed out obvious fakes with the above tests, but this one can sniff out even higher-quality counterfeit coins.
This test works best for 24k gold coins. The specific gravity of pure gold is 19.32, so if you suspect a 24k coin of being fake, this is a conclusive way to find if it’s real or not. Gold coins below 24k, like South African Krugerrands or American Gold Eagles, are made with mixed precious metals. You’ll need to find the specific gravity of that coin type to get the right value to look for.
For the specific gravity test, you’ll need a spring scale, a thread, a container, distilled water, and, optionally, an authentic coin of the same type as the suspect coin. Below are the steps to doing this test:
- Weigh the coin to get its “dry” weight, and note this down.
- Set up a wet test by attaching the coin to the spring scale using thread.
- Place the coin in the container so that it pulls on the spring scale without lifting it off the bottom.
- Observe where the coin sits in the container, then remove it.
- Fill the container with distilled water and put it on a standard weighing scale. Tare the scale by setting the reading with the filled container to zero.
- Carefully put the coin in the water until it settles at the bottom. Make sure there are no air bubbles. If there are any, tilt the coin using the thread or use tweezers to move it around until the bubbles are gone.
- Note the reading on the scale – this is the “wet” weight.
- Divide the dry weight by the wet weight to get the coin’s specific gravity. Then, compare the result to a real one or find the real coin’s specific gravity online.
If the coin is within 0.02 of the listed value, it’s real. If a suspect coin returns a result out of that range, it’s likely counterfeit.
How To Protect Yourself From Counterfeit Coins
As they say in medicine, an ounce of prevention is worth a pound of cure. If you’re certain about your coins, you don’t have to worry about testing a suspect coin.
If you want to protect yourself from fakes and scams, buy from legitimate coin dealers such as Money Metals Exchange or BGASC, with established reputations in the community. This won’t keep you 100% safe from getting ripped off as a counterfeit coin may still slip past even an experienced dealer. There’s also the small chance that the dealer is a counterfeiter themselves. However, buying gold and silver coins only from reputable dealers will minimise your risk of being scammed.
When evaluating coin dealers, look out for the following warning signs:
- “Special” coins
- Discounts for no apparent reason
- Offers below market value
- Prices that are too good to be true
- Dealers that are unwilling to meet in a brightly lit place with video surveillance
There is no reason for gold dealers to offer special discounts or go below market price. – the gold market just doesn’t work that way. Remember that a coin typically goes for the spot price of gold plus a markup. Any coin that is sold for less than that is automatically suspect.
Frequently Asked Questions About Detecting Counterfeit Coins
What methods can you use to detect counterfeit gold coins?
There are many ways that the average coin buyer can do on their own to detect a fake coin, such as sound tests, displacement tests, magnet tests, conductivity tests, and visual tests. However, only professional appraisers have the knowledge, skill, experience, and equipment to accurately determine a coin’s authenticity.
If you’re suspicious of a coin even after you’ve performed at least three tests on your own, we recommend taking the coin to an appraiser.
How common are fake gold coins?
Unfortunately, it’s very common to find fake gold bullion on the market. 41.2% of US coin dealers report that they have encountered fake gold American Eagle coins. Other coins aren’t safe, either – 30.4% have encountered fake South African Krugerrands, 24.2% have seen fake Canadian Maple Leaves, and 20.1% have handled counterfeit Mexican 50 pesos coins.
Counterfeiters typically mimic popular products with brand recognition, so be careful with more common coins.
What are counterfeit gold coins made of?
Most counterfeiting techniques involve creating a coin with lesser metals and wrapping it with gold. Typically, a base metal is much less dense than gold and has traits that gold lacks, such as being magnetic.
The highest-quality fake gold coins are made out of gold-plated tungsten – these are the most difficult to detect. Tungsten has a density very close to gold and mostly similar traits.
A counterfeit coin made of tungsten will pass most home counterfeit detection tests, except for the specific gravity test. Even then you’ll need an extremely precise spring scale to distinguish a gold-plated tungsten coin from a real gold coin.
Gold coins are an excellent investment, and they’ll serve you well in a crisis. To make sure they’re worth something when the time comes, you should be sure that every coin you have is real.
It may be scary to think about how common counterfeit coins are, but there are ways to protect yourself from being scammed by enterprising counterfeiters. Even the best counterfeits can be detected with the right test. Plus, if you stick to trusted, legitimate dealers, you don’t have to worry about testing every coin for authenticity.
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