All that glisters

I've written often about scams, of one kind or another. I find them fascinating.

I've tied myself in knots classifying this one, though. To my mind most examples of it are clearly over the "scam" line, and I think almost everybody would agree that at least some examples of it definitely are, but...

Look. Here's the deal.

The other day, I wrote about "liquid metal bullion"...

Melted fusible metal in plastic bag

...which was presented on eBay as some kind of investment that's fun for all the family. It's actually of some interest as a novelty, but has little monetary value and is full of poisonous heavy metals.

While exploring the peculiar world of the "liquid bullion" dealers, I discovered another odd category of eBay "bullion":

"Gold" bars and coins, that actually have very close to no gold in them.

And "silver" ones, too, and a few others plated with more exotic precious metals. But mainly gold.

Small fake gold bar with a winged Jesus on it for some reason

I bought one. Here it is. I paid a grand total of $US2.30 for it, including delivery, from this dealer.

It took a couple of weeks longer to arrive than it should have - possibly because the sender didn't know the difference between Australia and the UK, as far as address labels go - but apart from that, the transaction was entirely unremarkable.

I was going to cut into the bar to show it wasn't solid gold, but since it sticks to a magnet, I think we can pretty much take that as read.

A metal that sticks to a magnet must contain iron, nickel and/or cobalt, iron being the cheapest. So under the plating this is clearly a slug of iron or steel of some sort.

For the sake of completeness, though, I still measured its vital statistics.

Fake gold bar

The bar's dimensions are about 44 by 28 by 3 millimetres, which would give it a volume of about 3.7 cubic centimetres if it didn't have rounded corners and that embossed image of Jesus-with-wings-for-some-reason on one side...

Fake gold bar in display case

...and an angel and some symbolic Commandments on the other. (It also came with this little clear plastic case, to help keep the practically molecularly thin gold layer intact.)

(Oh, and yes, I did specifically choose this particular style of object-of-no-value made to appear desirable by a perfunctory shiny coating. On account of the symbolism. I'm dead subtle, me.)

When I measured the volume of the bar more accurately via the immersion method (PDF), as per the liquid "bullion", I got 3.5 cubic centimetres.

When I weighed it normally, I got 27.4 grams.

That gives a density of 7.8 grams per cubic centimetre. My lab balance and cack-handed technique are accurate enough that I'd say with some confidence that the real density is somewhere in the 7.75 to 7.85 range.

The density of pure iron is 7.9 grams per CC; various steels have densities between 7.75 and 8.05 grams per CC. Common mild steel is about 7.85.

So yeah, this is indeed a chunk of cheap steel, as any fool who stuck a magnet to it could have told you without all the science stuff.

At this point you might be thinking, "No harm, no foul". It looks like gold, but it doesn't feel like gold or in any way beyond superficial appearance attempt to resemble gold. So it's just a decorative trinket, not an attempted scam. Right?

Well, maybe. Except the auction title was:

HOT EXTREMELY RARE!! "Jesus"_1 Troy oz. .999 24K Pure Gold Layered Bullion Bar

Let that sink in for a moment.

As I write this, the same seller has more bars just like this one, plus other ones with these descriptions:

Amazing price MAPLE LEAF GOLD BAR One Troy oz 100 MILLS .999 Gold 24K PLATED

NR! 1 OZ GERMAN 999 PURE 24K GOLD CLAD 3RD REICH IRON WWI WWII BULLION BAR!

1 oz 24K GOLD plated elephant OF SOUTH AFRICA the Krugerrand BAR 100 Mills RARE

NEW ITEM! 1 OZ. SOVIET RUSSIAN USSR CCCP PURE .999 24K GOLD LAYERED COIN BAR NR!

...and so on.

All of the descriptions contain keywords you'll find in auctions of solid-gold items, but some of them also have the plain words "plated", and "gold clad ... iron". Others, though, only reveal their not-anything-like-solid-gold nature with odd terms like "100 Mills" or "gold layered".

Both of these terms seem to be recent inventions, at least when it comes to bullion. By definition, there's no such thing as "plated bullion"; it's as silly, though not as hazardous to health, as calling that low-melting-point alloy that has lead and cadmium in it "non-toxic".

EBay currently has quite a lot of allegedly-bullion items using these odd descriptions.

There actually is a unit called a "mil", with one L instead of two; it's a thousandth of an inch. That's obviously not what it means here, though, because a hundred mils is a tenth of an inch, which is 2.54 millimetres. If you can figure out a way to make something that's three millimetres thick yet plated with 2.54 millimetres of gold on both sides, a career as a TARDIS engineer awaits you.

What "mill" actually means to the eBay gold-plated bar-and-coin sellers is... unclear. Perhaps it's a millionth of an inch. A hundred millionths of an inch is 0.00254 millimetres, 2.54 microns; that actually does qualify per the US Federal Trade Commission as "Heavy Gold Electroplated". You can get thicker plating that that, too, up to the point where it qualifies as gold-filled, with the gold accounting for a readily measurable fraction of the item's weight, rather than just a barely-weighable plating. (Apparently a general rule of thumb for jewellery subject to wear is that one micron of plate thickness will wear off the item per year.)

Given that the "mill" is not any kind of defined unit and seems to be interchangeable with the similarly un-defined "gold layered", though, I don't think it's excessively uncharitable to assume that the actual thickness of the plating on these things is as thin as possible without letting the colour of the underlying metal show through.

I mean, the one I bought is supposed to be "1 Troy oz", too, but it only weighs 27.4 grams, not the 31.1 grams of an actual troy ounce. It doesn't even quite make it to an ordinary avoirdupois ounce; that's 28.35 grams. Given gross failures like this, I doubt the vendors spend a lot of time worrying about the actual thickness of their plating.

But so what, I hear you say. This is just the usual level of cheerful eBay flea-market dodginess, right? Anybody who's been on eBay for a while is probably familiar with its own special not-quite-scams.

Listings, for instance, that don't make it quite as clear as they might that the item being sold is an empty box which at one point contained the new and exciting game console prominently featured in the listing title. See also people selling a picture of a fancy guitar, or a miniature dollhouse version of a big-screen TV. Et cetera. If the buyer cannot figure out why a "one ounce" gold bar is selling for $2.30, wasting money on eBay is probably not their biggest problem.

I invite you, at this juncture, to check out the highest prices people have paid for "100 mills" or "gold layered" things on eBay, by searching completed listings. Red numbers indicate something that didn't sell, green numbers indicate a sale.

As I write this, that search is headed by "1 OZ GOLD SOUTH AFRICAN 2010 KRUGERRAND COIN BULLION 100 MILLS 999.9 24K LOT 10", which a UK seller unloaded for £670 ex delivery - more than a thousand US dollars.

Those were clearly not real Kruggerands, because the listing says: "This 2010 coin is layered with 100 mills thick of pure 24k Gold". But right before that, the listing copies from Wikipedia and says, "The Krugerrand is a South African Gold Coin, first minted in 1967 to help promote South African Gold. The coin, Produced by the South African Mint, proved popular and by 1980 the Krugerrand accounted for 90% of the global coin market".

Which is true. But those solid gold coins are not what this dealer is selling. They are selling ten coins that look a bit like them, but are each worth no more than my little plated Jesus-bar.

Unquestionably, the person who paid £677.95 delivered for these ten shiny poker chips was under the impression that they'd just bought ten ounces of highly fungible gold at a huge discount.

They are not alone in this thought. Scrolling down that search turns up a ten-gram "100 Mills" bar that sold for a hundred UK pounds, then a five-gram "100 Mills" bar selling here in Australia for $AU122.50, then a five-gram "100 Mills" bar from an Irish dealer selling for €87.50.

Four "2010 UK SOVEREIGN COINS -1oz - 24k PURE GOLD Layered .999 Fine -TAX FREE"? Those had "100 Mills" in the description, and went for £159.90 delivered. Another seller was pleased to relieve a customer of £154.94 delivered for "NEW 2013 Royal Coronation & 2012 Jubilee 24k PURE GOLD Layered Double Coin Set", again allegedly "100 mill" plated and "Genuine Coins - Not Copies Or Reproductions"!

That same seller also managed to unload a single "2010 BRITISH SOVEREIGN 24K PURE GOLD Layered Proof COIN -1oz .999 Fine *MUST SEE", for £106.99 delivered.

And on and on it goes.

So: Is this a scam?

I'd say yes, because "good faith" is a critical legal concept. Good-faith, as I've written before, is the undoing of a long list of "technically legal" rip-offs. If there is no way anybody would agree to a given deal if they knew exactly what it was, then camouflaging the true nature of that deal, however lightly, is attempted fraud.

Deals of this nature are, of course, not hard to find, and they're often being offered by large corporations, not eBay fly-by-nights. Payday-loan shops, dodgy mechanics, questionable sweepstakes, and umpteen outfits whose business model seems to accept a repeat-business level below one per cent and the kind of word-of-mouth goodwill usually only enjoyed by serial killers.

What about rebate programs that require you to send the same cut-out barcode from a package to two different addresses simultaneously? Reward-points programs predicated upon normal consumers' points expiring before they accumulate enough to be able to redeem them for anything? Airlines that routinely sell more tickets than there are seats on the plane, in the expectation that not everybody will actually get there on time (thanks, interminable "security" nonsense!)? And, of course, the worst invention in the history of capitalism, gift certificates, whose principal reason for existence is "breakage", that portion of the gift cards sold which are never redeemed.

There's plenty of other underhanded activity in the bullion market, too, with the endless promotion of overpriced "collectible" bullion coins (particularly to certain market segments...), and sharp dealing in the "cash for gold" business. But at least all of those outfits generally are selling and buying actual gold, not plated slugs that only superficially resemble actual bullion.

Advertising a near-worthless little chip of gilded steel as "Gold Bar 5 Grams 'Canadian Maple' 100 MILLS .999 24k Fine Bullion!" is not a good-faith act. You're clearly fishing for suckers.

There are some other murky terms used in describing these bullion-like shiny objects. "HGE", for "heavy gold electroplate", for instance, which is a term that exists in the jewelry market, but not so much in the bullion one. And "gold dipped", suggesting there's some worker out there spending all day dunking Krugerrand-resembling circles of steel in a cauldron of molten gold. There's "thick layer", too, which I think always indicates a layer actually notable for its thin-ness.

This rather cumbersome eBay search is for several of these terms, but not the slight-honesty-indicating terms "not pure gold", "not 100% solid gold" or "not solid gold". It has plenty of hits even when it's only searching the titles, and hundreds of hits if you click the little "Include description" box and then click Search again.

People sometimes pay big bucks even for the eBay items whose listings do include "not solid gold" disclaimers, though. And everybody who buys one of these things for more than the couple of bucks it's worth should have paid more attention. There's almost always some clue, if only what turns up when you search for terms like "gold layered" or "100 mills".

But not everybody is able to pay more attention, or aware of just how many scams there are on eBay.

I would also be willing to bet, given the long and depressing list of large green numbers in a completed-listings search for this gold-plated tat, that some people have spent a lot of money on these things. Perhaps they're hoping to quickly flip this amazing bargain to local precious-metal dealers. Perhaps they're under the impression that they're providing for their childrens' future. All they're actually doing, though, is transferring their life savings to a person selling scrap iron, and possibly lining themselves up for criminal charges if they ever try to sell these damn things on.

Not everybody selling gold-plated imitation bullion is a scumbag. Some of the "gold layered" listings are fixed-price "Buy It Now" items, for instance. Those cost a few bucks more than the auctioned ones usually sell for, but by their very existence they provide a strong clue that both they and their auctioned cousins aren't what your slightly dotty grandparent with an iPad and time on their hands might at first assume them to be.

Someone could still blow their entire retirement nest egg on the Buy-It-Now ones, but it'd take some effort. And the buyer would at least end up with a really big pile of almost worthless gold-plated novelties, which'd look good in an outraged local news story.

Some of these things also have pretty-much-honest descriptions, that clearly say something like "plated" or "replica" instead of "dipped" or "layered" or whatever. (The one I bought may not have put any disclaimers in the title, but its description text did contain "*PLEASE REMEMBER THESE BARS ARE NOT SOLID GOLD*".)

Even these better dealers do still love the magic word "bullion", but they're nonetheless more or less in "good-faith" territory, if you ask me. Even a moron in a hurry might realise the product is not solid gold when it says "plated" right in the auction title.

Oh, and just to confuse things even more, you can get real silver coins and bars that've been "layered" with gold. People overpay for those, too. As I write this, a Completed Listings search shows that someone thought a "2000 Washington Mint Sacagawea 24kt Gold Layered .99 Silver 4 Troy Oz Coin" was worth $US167.49 delivered. The gold value of that coin is as usual negligible, but presuming the seller's telling the truth about the amount of silver in it, then it is at current spot prices worth about eighty bucks.

So, still a rip-off, but only by about a factor of two.

("Silver-gilt" items are quite common in the legitimate jewelery business, especially for large items like sculptures and medals. Olympic "gold" medals, for instance, are silver-gilt to keep the price down. By specification they have to be be at least 60 by three millimetres, which at 2014 gold prices would make them cost the thick end of seven thousand dollars. There are more than three hundred events in a Summer Olympics and another hundred in the Winter, so that'd add up, especially for larger-than-spec medals; the London 2012 medals were unusually large, at 85 by 7mm. That much solid gold is currently worth well north of $30,000. So instead, Olympic golds are silver with a generous six-or-more grams of gold plated onto it, to make sure that even if the medal-winner insists on wearing the thing around all day, it won't wear through the plating.)

As I write this, a Completed Listings search for these gold-plated silver coins shows only six sold going back to May this year. The least anybody paid for one was $US105 delivered. For a coin worth, I remind you, $80. And that only when you manage to find someone who'll listen to your story about how there really is some silver there under the silly gold plating.

(This problem may solve itself, because very thin gold plated straight on top of silver will slowly turn silver and tarnish as silver atoms migrate through the gold. To avoid this, "proper" gold-plated silver jewellery has "barrier layers" in between, in a sandwich that may be silver, then copper, then nickel, then finally the gold. I doubt the sellers of "gold layered" "100 mills" silver coins go to these lengths to make sure their products retain their lustre.)

High in the most-expensive-first Completed Listings searches you'll also find a number of people paying a few hundred dollars for one hundred plated coins or ingots. Those people have not been ripped off either, though I presume most of them are hoping to get in on this occasionally-lucrative business themselves.

Please don't do that.

If you appreciate kitsch, do feel free to decorate your wall with the complete series of ULTRA RARE SOVIET NAZI JESUS ELEPHANT LUCKY MONKEY MARTIAN GOLD LAYERED ALMOST AN OUNCE HYPERBULLION INGOTS.

But I wouldn't pay more than two bucks a unit, if I were you.

11 Responses to “All that glisters”

  1. Jambe Says:

    You, my good sir, are an unalloyed delight. Your writing (and linking!) is consistently entertaining and engaging.

    Now I'm stuck imagining crucifixes sprouting wings and drifting mysteriously skyward. I can kind of get why maybe Jesus might sprout wings given that he supposedly ascended, but it seems as if the cross has itself sprouted wings to form a barbaric Torture-and-Execution Bird. That's the hellish counterpart of the Bird of Paradise.

    Perhaps it was made of Cornus lofticae.

    ... I'm goin'ta hell.

    Anyway, thanks.

    • dan Says:

      Now that I think of it, whoever first came up with that design must have thought, "Jesus has to be in front of the cross, obviously, but the wings'll have to be behind it, or you won't be able to see the cross and the nails would have to go through the wings too... but the nails WOULD have gone through the wings too, wouldn't they, or Jesus could have just flown off, cross and all, into the sky! 'My God, My God, why have you forsaken me, I'll just come and visit and you can tell me!' No, focus dude, the wings are metaphorical or something, the Bible-rubbers commissioning this probably said that in the middle of all that stuff I tuned out. So I'll do the wings stuck to JC's back and sticking out at an angle behind the cross. I could do his torso leaning forward to leave room for the wing roots... no, that'd look weird. I'll just do a regular crucifix with wings behind and be done by lunch time."

  2. MikeLip Says:

    I am very willing to bet my entire life savings ($1.97 since the latest miscalculation by our friends in the banking business, and somewhat overoptimistic realty market) that the first scam like this was for some kind of animal bone. With a genuine meat flavored coating and bonus gristle. 100 round rocks with holes in them, starting price.

    Unless you fundamentally change people somehow, these scams will never die - they will just find a new home if, somehow, they are eradicated from eBay. Which is unlikely since eBay likely makes a fortune from them. Sorry, Dan. Windmills always win the tilting contests.

  3. Synthetase Says:

    I followed your link to the post on people flogging copper as bullion in your last post about the low melting alloy, and boy did the people in the comments there need a few extra neurons.

    Interestingly, there are plenty of suspicious electronic components floating around ebay as well. I never would have thought that people would sell fake transistors or potentiometers, but they do.

  4. MikeLip Says:

    Yeah they do. I got a shipment of fake IR phototransistors in. Thousands of them. They were little red squares of plastic with three wires stuck in them. Per piece cost from a parts jobber like Digikey (not a cheap source, for those who don't know Digikey) would be about 15cents US. Why would anyone fake something that cheap?

  5. dan Says:

    Since a living wage in China is about $US300 per month, even if you only clear five cents per unit for fake electronic components, you only need to sell six thousand a month to be making an awful lot more than an awful lot of honest workers in the technology sector. If you're dumping reels and reels of the things onto every market Alibaba and eBay can find you, you could easily support a whole little factory.

    Lumps of plastic with wires stuck in 'em are the good kind of fake component, too. The bad kind is, as I'm sure you know, shit that superficially works but is horribly out of spec. Possibly because it's a tiny transistor huiding in a TO-3 casing, or an electrolytic cap that'll barf its guts out in six months guaranteed, or something that'll work at the specified voltage for maybe a whole day...

    Yay capitalism!

    (I'm reminded of a documentary from the early Nineties about some Eastern European country transitioning to capitalism in which a miserable peasant said "When we were Communist, we had the worst Communists. Now we are capitalist, and we have the worst capitalists." Probably Albania: http://en.wikipedia.org/wiki/Pyramid_schemes_in_Albania )

    • setbit Says:

      Yay capitalism!

      I know you're saying that at least partly tongue in cheek, but I'm sure some of your more impressionable readers might take it at face value.

      So for the record: calling these scams a natural consequence of capitalism makes about as much sense as calling 9/11 a natural consequence of air travel and tall buildings.

      The example of Albania is very instructive however. When, for whatever reason, a country/society/culture/community/neighborhood comes to a place where shafting people is just an expected part of life, it doesn't matter any more what the nominal economic rules are. People end up spending enormous energy trying to scam others, or protecting themselves from being scammed. Actual productive work becomes something for suckers, and the whole society ends up stuck in chronic poverty, fighting over scraps.

      You see this kind of thing in all places and times, of course, but it only thrives when and where it's widely tolerated.

  6. Synthetase Says:

    I've built a few amplifiers recently and noticed that pricey audio power transistors turn up for suspiciously low prices on ebay. They often retail for >$10 per device, so I can see why people fake them. In the end I sucked it up and got them from a supplier that I know gets them directly from On-Semiconductor and paid the premium. I just can't be bothered pulling amps apart to rip out sub-standard components and replace them after they've failed. Not to mention the posibility of a transistor failing short circuit, and dumping the power rails onto a very expensive set of speakers. Just not worth the worry, even with DC protection circuits.

  7. arboreal Says:

    Hi Dan,

    I've noticed on a few of your photos in which your hands are shown, blisters and suchlike which look remarkably like the ones I've noticed on my own fine hands. Seeing as I do very little manual work, and in the spirit of hypochondriasis (not deeming it necessary to bother an actual proper health professional), I've self-diagnosed as having pustular psoriasis.
    Do you actually do proper physical work and my observations are worthless? Is my hypochondria man-mentalling me into noticing things that are not there?
    Also, In the UK, I've only heard of 'glistens' and 'glitters' in relation to gold. I'm not saying I'm correct, and you may well be making some totally unknown to me reference to something everybody else knows but hey, I've suggested you've got a skin condition so what's to stop me when my ball's rolling?

    • setbit Says:

      RE: "glisters"

      It's from Shakespeare. I'm guessing Dan did not feel obliged to spell this out because he was assuming that his readers have access to the Internet.

    • dan Says:

      Every time I look at my hands these days they do seem rather wrinkly, which is surprising given the fact that I obviously stopped aging at seventeen, as did almost everybody else I know.

      All perceptual distortions aside, though, there are no blisters or pustules or other irregularities on my hands. They're sort of blotchy sometimes, and sometimes the veins stick out and sometimes they don't, but I don't think there's anything diagnosable there.

      My fingernails are a bit short, but I think only because I tend to clean under them too enthusiastically.

      (If, like me, you play keyboards, you should ideally have no finternails at all.)


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