Counterfeit Sports and Celebrity Memorabilia

• IRS uncovers largest U.S. forgery ring ever.
• Experts say more than half of all autographed sports and celebrity memorabilia is bogus.

In the mid 1990s hundreds of thousands of pieces of autographed sports and celebrity memorabilia were confiscated as part of a nationwide investigation which uncovered the largest forgery ring in U.S. history.  As a result, it is estimated that at least 50% (and some experts say, over 90%) of all autographed sports and celebrity memorabilia is counterfeit.  At the time of the initial investigations, sales of forged memorabilia were believed to exceed $100 million annually.

FBI Investigation
This all came to light when the Chicago Division of the FBI opened an investigation in the early 1990s they called "Four Ball".  By the mid 1990s they had convicted 14 individuals in 5 states of marketing forged and fraudulently authenticated Chicago athletes' autographed memorabilia.

Phase I.  The investigation led to an even larger IRS investigation called "Operation Bullpen".  Realizing that this was a nationwide problem, the FBI in San Diego along with the U.S. Attorney's Office and the IRS commenced Phase I of Operation Bullpen in 1997.  Five forgery rings were uncovered and on April 11, 2000, 26 people were convicted of marketing counterfeit autographed sports memorabilia, all with fake authentications.

Phase II.  In the next five years, the FBI pursued Phase II of Operation Bullpen.  On September 11, 2001 18 search warrants were executed in an investigation that spread over 12 states.  The FBI uncovered 13 forgery rings and eventually convicted 26 individuals.  Included in the convictions were numerous Internet auction sites, including one that was the largest seller in the world of signed celebrity photographs.

Phase III.  It is our understanding that Phase III of Operation Bullpen dispersed the confiscated forged and phony equipment and memorabilia to charities in the San Diego community.  Although the intention was honorable, the wisdom of disseminating counterfeit material rather than destroying it is dubious at best.

The Outcome
As a result of this investigation, Major League Baseball instituted the practice of placing unique holograms on "game used" items.  If you want to learn more, Kevin Nelson's well researched and detailed Operation Bullpen: The Inside Story of the Biggest Forgery Scam in American History is the book to read.  The FBI itself provides a quick overview of Operation Bullpen.

Not everyone who sold counterfeit pieces knew they were phony.  Many dealers were duped too and innocently (or ignorantly) bought and sold bogus memorabilia.  Most of the pieces originally went into private collections, but as the owners are now starting to sell some of these items, they are discovering what they have is worthless.  And sadly, we are starting to see these items on the marketplace in record numbers.

What To Do
What should you do if you think you might have a counterfeit piece of memorabilia?  First, talk with an appraiser qualified to determine the value of your item.  He'll know the reliable dealers and authenticators. and can advise you what to do. You might also need legal advice about your purchase, or an expert witness if the matter goes to court.

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Summary:  Experts say over 50% of sports and celebrity memorabilia is fake!  IRS sting Operation Bullpen, conducted with the FBI, uncovered 13 forgery rings and convicted 26 individuals.  If you're buying or selling, don't get stung yourself.  Check with a qualified appraiser first.

Appraising vs. Authenticating Sports Memorabilia

• Often confused, appraising and authenticating are actually quite different.
• “An item can be appraised without authenticity.”

Appraising and authenticating are two different professions. An appraiser determines the value of an autographed item; an authenticator determines if the signature is genuine. Similarly, an appraiser estimates the market value of a rare baseball card or team jersey; an authenticator determines if the item is real or a fake.

Authenticating Firms
There are several major authenticating firms that will provide a COA (Certificate of Authenticity) which will be readily accepted in the industry, by collectors and by the courts. Normally, you have to send your ball or other item to the authenticator, but if you are hesitant to do so, several of the firms authenticate on-site at shows around the country. A web search for “sports memorabilia conventions” will pull up a list of events and organizers..

Auction Houses
Also, some of the major auction houses specializing in sports memorabilia, have authenticators on staff. If they accept your item for auction, they will normally guarantee its authenticity. The cost of this service is included in the auctioneer's commission.

Frauds
Regretfully, there are also unethical individuals who claim to be authenticators but whose COAs literally aren't worth the paper they're written on. An official looking COA or an impressive website doesn’t guarantee a valid authentication. Caveat emptor! (Email us for a current list of the authenticators we recommend.)

Hypothetical Appraisals
It is interesting to note that an item can be appraised without authenticity. This is called a hypothetical appraisal and is based upon information, photographs, etc. provided to the appraiser and accepted at face value. In this case the authenticity rests upon the information supplied to the appraiser. At first glance, hypothetical appraising might seem questionable, but it is a common and necessary practice, especially after a loss, such as a fire or theft, when the item is no longer available for the appraiser to inspect.

When you have an item you want appraised but don't have a COA, talk with your appraiser. He can recommend the best and most ethical course of action.

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Summary: An appraiser will tell you what your sports or other item is worth; an authenticator will tell you if it's real. As a rule, professional appraisers don't authenticate, and authenticators don't appraise.

Links: Email Sallie & Bob

What is an Appraisal?

• What is it and who is qualified to prepare it?
• "If you plan to have an appraisal done, always check the credentials of the appraiser"

The three appraisal disciplines that matter most to individuals are real estate, personal property, and gems & jewelry.  Real estate appraisers are licensed by the state, but sadly there is no state licensing for the others.  I say sadly because anyone can hang out a shingle and call themselves a personal property or gems & jewelry appraiser when they may be no more qualified than the kid next door.

Gems & jewelry is self-descriptive. The personal property discipline covers virtually every property item, other than real estate, from cars to stamps, paintings to oriental rugs, watches and lamps, sports memorabilia to furniture, and on and on.  There are appraisers of personal property qualified and certified to appraise almost everything you own!

In the 2006 Pension Protection Act (PPA), the Federal Government established the requirements for a qualified appraisal and defined who is qualified to do an appraisal for tax (IRS) purposes, such as for gifts, donations or estates.  Very briefly, a qualified appraiser is someone who is tested and accredited by one of the major appraisal organizations (eg., ASA, AAA, RICS) and has passed the Uniform Standards of Professional Appraisal Practice (USPAP) exam within the past 5 years.

An appraisal is a legal document. Every appraisal is prepared with the knowledge that it might be called into evidence in a court of law.  Therefore an appraisal needs to be a lot more than just a listing of your items with their values. 

Many books and entire college courses have been devoted to exploring the elements of an appraisal, so there is no way I could describe it adequately in this short commentary.  Briefly, every appraisal needs to include, among other detailed essentials, a definition of its function and purpose, the effective date, the type of valuation (Fair Market Value, Replacement Value, etc), certification that it is done in accordance with USPAP, the appraiser’s qualifications, and any assumptions, liabilities or limiting conditions.

As you can see, a lot goes into making an appraisal, and a lot may ride on its accuracy.  If you plan to have an appraisal done, always check the credentials of the appraiser to make sure they are competent to provide you with a professionally prepared appraisal.

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Summary: If an appraisal doesn't conform to USPAP and the appraiser isn't licensed (real estate) or accredited (other disciplines), it may not be accurate and probably won't hold up in court.

Links: American Society of Appraisers (ASA), Appraisers Association of America (AAA), Royal Institution of Chartered Surveyors (RICS), Uniform Standards of Professional Appraisal Practice (USPAP)

Notes:  The classification of appraisal disciplines generally includes two others besides real property (real estate), personal property and gems & jewelry, namely business valuation and machinery & technical specialties.  Most disciplines include recognized sub-disciplines or specialties.  For example, a real property appraiser might focus on residential real estate, while a personal property appraiser might focus on decorative arts.

The Best Kept Secret about Cooperstown, NY

• No, not the Baseball Hall of Fame, the Fenimore Art Museum
• "Do plan to have lunch at the museum; the menu is top shelf"

Say "Cooperstown, NY" and people naturally think of the Baseball Hall of Fame.  If you are a fan, the HOF is a must-see.  But many are not aware of the wonderful Fenimore Art Museum located on the northwest side of Cooperstown.  In 1944 Stephen Carlton Clark, descendant of the Singer Sewing Machine Company founder, donated the Fenimore House to the New York State Historical Association to house the museum.  The impressive neo-Georgian structure on the shore of Otsego Lake occupies the picturesque site of James Fenimore Cooper's 19th century farmhouse.

The Fenimore's permanent collections boast outstanding examples of American artists including from the Hudson River School, such as Thomas Cole and Asher Durand, portraitist Gilbert Stuart, American folk artist Edward Hicks and many other notables.  There are distinguished pieces of decorated stoneware, ship figureheads, quilts, trade signs and cigar-store figures.  Housed in a recent addition is one of the nation's premier collections of American Indian artifacts.  There is also a unique collection of life masks cast from famous Americans such as Thomas Jefferson and Dolley Madison.

Until December 31, 2010, the Fenimore is hosting a premier exhibit of John Singer Sargent titled Portraits in Praise of Women.  We saw it recently, and it is fantastic!  Paired with the exhibit is the museum’s collection of historic costumes titled Empire Waists, Bustles and Lace.

Cooperstown is beautiful anytime of year, but Fall is by far the most scenic time to visit this quaint town.  And with the kids back in school, downtown Cooperstown is a lot easier to navigate.  Do plan to have lunch at the museum; the menu is top shelf, and if the weather permits, you’ll be seated on the back patio overlooking the lake.  What a view!

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Summary: Renowned for its Baseball Hall of Fame, Cooperstown, NY is also home to the Fenimore Art Museum, a destination attraction for lovers of art, antiques and artifacts.

Links: Baseball Hall of Fame, Fenimore Art Museum, James Fenimore Cooper, Hudson River School, John Singer Sargent Virtual Gallery

Selling Gold or Silver? Know What's It Worth!

You've been bombarded and possibly confused by the ads on television, radio and in your local newspaper telling you "special buyers" are in town for a limited time and will be paying "top dollar" for your unwanted gold and silver items.  Our advice: Whenever possible deal with someone local that you know, someone who has been in business in the area for a while and has a good reputation.  A reputable dealer will offer you 70 to 80% of today's spot gold price and possibly more it you have a large quantity to sell.

Selling Gold? Know It's Value!

What is the Spot Price?
Basically it is the daily selling price of precious metals on the Commodity's Exchange.  It is published daily in your newspaper or you can find it on the web.  Spot is figured on pure gold which is 24 karat gold.  So if your item is 24K it is figured at 100% of spot, but most gold is marked 12K (which is 50% of spot) or 18K (which is 75% of spot) and so on.  You can figure the percentage by dividing the karat by 24.  Spot is figured in Troy ounces, not the common Avoirdupois ounces we use at the grocery store and post office.  (There are 12 ounces in a Troy pound vs. 16 in an Avoirdupois pound, so a Troy ounce is heavier, about 1.1 avoirdupois ounces.) Something else you should know is there are 20 pennyweights (dwt) in a Troy ounce.  (A pennyweight is abbreviated dwt instead of pwt, because d, for the Roman denarius, was the abbreviation for penny before the British monetary system went decimal.)

Figuring the Value
Here is our formula for buying gold or silver:  The Spot value of your gold = today's Spot price (dollars per Troy ounce) X purety (karat of your gold/24 for 100% pure) X fractional weight (your gold in dwt/20 dwt per ounce) X % the buyer is paying.  A shorter form is Spot/480 X karat X dwt X % paid.  This is the most common formula precious metal buyers use when making an offer to buy your gold or silver and it is fair to both the seller and the buyer.

I Own a Railroad Watch!

I can't tell you how many times someone has called us or come into the Connelly Gallery with a "railroad watch" that belonged to their grandfather or great grandfather. They believed it to be a railroad watch because it had an engraving of a train on the back of the case. Most often they had a case that is called a Hunting Case (HC), which means the watch has a cover over both the movement and the face.

Hamilton Railroad Watch

Railroad Watch
To tell you what a real railroad watch is, I have to tell you a little history. In 1893 after a train disaster in Ohio, the railroads set standards for the watches used by railroad employees. Since there was no mechanism for knowing the exact time, as there is today, railroads became the nation's timekeepers for a while. All railroad employees had to have an open face watch (OF) with at least 17 jewels (adjusted to 5 positions) and it had to be a lever-set mechanism to change the time plus it had to stem wind at 12 o'clock. There were a few other requirements such as it had to have Arabic numbers on a black and white face with black hands and the grade had to be stamped on the back of the movement. And, it had to be accurate to with in 30 seconds in 30 days.

Regulator Clock
In the late 1800's through the early 1900's railroads were the time keepers for our nation. Often the railroad station would have a "Regulator" clock hanging on the wall. It is interesting to note that a true regulator clock told time only; it was never a "time & strike" clock. So if your clock also chimes and/or strikes the hour, it is not a true regulator clock.

What is an Antique?

According to the U.S. Customs Service, an antique is an item that is 100 years old or older. However, many people think that anything that is old is an antique.  But  since "old' is a relative term which means different things to different people, it is safest to stick to the 100 years old or older when defining an item as antique.

Tiffany style antique lamp

Antiques include the full range of items from everyday utilitarian items to purely decorative pieces. Even food, such as Civil War hardtack, is an antique. But just because something is old doesn’t mean it is valuable.

Valuation
Value is determined by supply and demand. Something can be an antique (i.e. over 100 years old) but if no one wants it then it has little, if any, value. So age alone is not the determining factor when appraising an antique. If there is little or no interest in owning a particular item, its value will be correspondingly little or nothing.

Comparables

Just because you see something advertised on eBay with a “Buy it Now” price or you see a price tag on something at a show does not mean the item is worth the asking price or that it will sell for the asking price. With eBay sales, always look at the ‘Completed’ sales to see if the item you are interested in has sold and for how much.

This is one of the ways an appraiser begins to determine the value of an item, he (or she) looks for comparable sales where similar items have sold on the open market. There are many other factors an appraiser considers when determining the value of an item, but that's fodder for another post.

What are Collectibles?

A collectible is most anything less than 100 years old that someone wants to buy or collect.  We delineate collectibles into two categories, a true collectible and a man-made collectible.  Both may have value but there is generally more value for a true collectible than for a man-made collectible.

Barbie Doll Collectible

True Collectibles
A true collectible is an item that was not intentionally made or produced to be collected.  Rather it was meant to be used or played with or just enjoyed for its decorative value.  An example would be the first Barbie Doll, which was produced in 1959.  These dolls were played with, not put on a shelf in its original box with the idea that someday it would be worth a lot of money.  Today, the few early ones that were kept in near mint condition are worth a lot of money, even more if you have the original box.


Man-Made Collectibles
By comparison, the modern day man-made collectible Barbie dolls although truly quite lovely to look at are worth only a small proportion of the 1959 Barbie.  At the present time the marketplace for these modern dolls is the first-time buyer; they are difficult to sell on the secondary market even for the original purchase price.  There are some rare exceptions where they sell for more than the original price but not as a rule.


Baseball Cards
Baseball cards manufactured prior to 1970 have more value than those produced after 1970 as the earlier ones were collected by kids who played with them, swapped them with their friends or even put them on their bicycle spokes to make their bikes sound more like a motorcycle.  Around 1970 baseball card manufacturing companies started mass producing cards and as the supply went up, the demand went down.  Consequently the market for modern cards is very poor compared to the earlier cards.