Tuesday, August 09, 2011

A Disastrous Legal Decision

Baltimore District Court Dismisses ACCG Lawsuit Challenging Import Restrictions

The text of the Memorandum dismissing the lawsuit filed by the ACCG follows:

This action arises out of the seizure of twenty-three ancient Cypriot and Chinese coins
that the Ancient Coin Collectors Guild (“ACCG”) purchased from a coin dealer in London and imported to the United States. Following the seizure, ACCG filed this action “to test the legality” of import restrictions imposed on certain ancient Cypriot and Chinese coins. ACCG sued the U.S. Customs and Border Protection (“Customs”), the Commissioner of Customs and Border Protection (“Commissioner of Customs” or “Commissioner”), the U.S. Department of State (“State”), and the Assistant Secretary of State for Educational and Cultural Affairs (“Assistant Secretary for ECA”) (collectively, “the defendants” or “the government”), alleging violations of the Administrative Procedure Act (“APA”), the International Emergency Economic Powers Act (“IEEPA”), the Civil Asset Forfeiture Reform Act of 2000 (“CAFRA”), and the First
and Fifth Amendments to the U.S. Constitution. ACCG also alleges that the defendant acted “ultra vires,” and seeks relief in the form of a declaratory judgment, an injunction, and a writ of mandamus. Pending before this court is a motion to dismiss or, in the alternative, for summary judgment, filed by the defendants. For the reasons discussed below, the government’s motion will be granted.


The 1970 UNESCO Convention and the flawed 1983 CCPIA that implements it in the USA, have been sustained as the law of the land.

US coin collectors must realize that this decision is extremely adverse to their collecting interests, and that the archaeology lobby, in collusion with the anticollecting Kouroupas regime in the State Department, may now be expected to aggressively pursue further import restrictions that will in effect (over a period of years) make it impossible to licitly import most ancient coins into the USA.

From a practical perspective, this means that importation of ancient coins into the USA will shift from being a licit activity to an illicit activity which the US Government does not have the power or means to control. This situation poses very serious ethical questions for US collectors and dealers.

At this point the USA comprises about 50% of the worldwide market for ancient coins. Thus, decisions taken by US collectors and dealers will inevitably have significant effects upon the international numismatic market.


Every collector and dealer in the USA must make his or her own ethical and decision. I can only present my own thoughts as those of a well informed participant in the US ancient coin market.

I have been mulling over this possibility for quite some time, and have arrived at some very important conclusions.

First, as reported in

The US government, along with every other government in the world, does not presently have and cannot possibly acquire the power to enforce a ban upon trading in ancient coins. No government presently possesses or ever will possess sufficient control over its borders or postal system to prevent a relatively free illicit international trade in ancient coins from being carried on across its borders.

Thus, the effect of the import restrictions that so far have been, and in the future prospectively will be, promulgated is to impose an era of "coin Prohibition" which will inevitable prove to be just as ill-advised and futile as "alcohol Prohibition" did between 1919 and 1933.

There is one very significant difference between the coming era of "coin Prohibition" and the past era of "alcohol Prohibition." Licit possession of, and licit free trading in ancient coins within the national borders of the USA are not affected by (and cannot possibly be affected by) any regulations or agreements that the State Department, in unethical and anti-American collusion with the archaeology lobby, can unilaterally impose. Since the USA presently comprises about 50% of the international free market for ancient coins, decisions that US collectors and dealers make as to how to respond to "coin Prohibition" will have a very significant impact upon not only the free market for ancient coins within the USA, but also the free market for ancient coins worldwide.

My perspective is that we must recognize that in the absence of a comprehensive legislative solution to this problem, adversaries of private collecting have now temporarily obtained the power to legally divorce the US free market in ancient coins from the international free market in ancient coins. They have acquired the power to prevent ancient coins from licitly crossing the borders of the USA to enter that nation, and can be expected to aggressively use that power to gradually impose MOUs that will do so. Within the next ten years we can expect that the anticollecting Kouroupas regime in the State Department will negotiate MOUs with every ancient coin "source state" which will make it illicit to import ancient coins of every description into the USA.

This raises the question of how US collectors and dealers should react to such a ban on importation. It would not be per se disastrous, considering that it would in effect merely split the worldwide market in half. What would however be disastrous would be the imposition of a "check valve" that would not restrict ancient coins from being exported from the USA, but would prevent their importation. This would gradually deplete the US free market of licit ancient coins, and eventually prevent US collectors from licitly acquiring ancient coins.

I don't believe that any US collector or dealer in ancient coins desires to break the law. I personally would not consider doing so, and would transition to other lawful activities in lieu of attempting to carry on a numismatic business under circumstances rendering that business illicit. Fortunately, that is not the choice we are confronted with. Instead we must decide how to manage a numismatic trade in a situation in which there will be one licit numismatic trade for the USA, within which coins freely circulate between collections, and another licit numismatic trade for the rest of the world, within which coins similarly freely circulate.

I propose the following as a sensible, ethical, lawful and constructive approach to be pursued by the US numismatic community: no coin shall leave our borders without right of repatriation. In other words, it should not be deemed ethical for a US collector or dealer to export an ancient coin that cannot subsequently be licitly reimported into the USA.

In my opinion, widespread acceptance of that doctrine among the US collector and dealer community could well have a significant impact upon the desire of source states such as Italy and Greece to impose US import restrictions upon ancient coins.

Finally, I believe that the above proposals impose an ethical obligation upon me to propose a system of tracing provenance which will significantly alleviate (although not entirely eliminate) the effects of forthcoming import restrictions. I have previously discussed this issue:

It would be feasible to provide a system of tracing provenance which would document licit acquisition of coins by dealers and their subsequent licit acquisition by collectors. One of the key issues in doing so is that such transactions should not be disclosed to opponents of private collecting and opponents the free numismatic market. This must not become a "propaganda tool." The way to accomplish the desired result without such a transgression is to create a "coin ticket" that is not disclosed to anyone other than the collector who acquires the coin. I know how to do this, and intend to do so, and to eventually disclose the essential elements of this "coin ticket" in such a manner that they may freely be provided by every dealer, and I accept an ethical obligation to do so.

Clearly such a declaration of intent cannot be taken lightly and the necessary approach must be one which is practical for most dealers. The technical aspects are far less formidable than the ethical issues involved. It can, and soon will, be done. I cannot however guarantee its universal acceptance by every dealer.

Monday, August 08, 2011

Coin Prohibition: a Historical Parallel

Last evening (Sunday, August 7) the History Channel featured RUMRUNNERS, MOONSHINERS AND BOOTLEGGERS, a well-presented exposition of the immense difficulties faced by US authorities attempting to enforce national Prohibition during the period in which it was the law of the land (1919-1933).

Despite the efforts of filmmakers to portray federal agents such as Elliott Ness as noble heroes, the reality was that moonshiners and thugs like Al Capone had great success in corrupting law enforcement officers and evading the scrutiny of those who could not be corrupted. Less than ten per cent of illegal alcohol was ever intercepted, and law enforcement efforts ultimately proved to be nothing more than a nuisance to those involved in the illicit alcohol trade and illicit alcohol consumption.

I was struck by the parallels between Prohibition and efforts to restrict (and ultimately end) the international trade in ancient artifacts such as coins, and their possession by private collectors. In many ways it seems that this present day anticollecting effort is an eerily similar replay of what took place in the USA during the era of the Temperance Movement, which began in the mid-1800s and actually succeeded in prohibiting the consumption of alcoholic beverages in a majority of US states before national Prohibition was enacted.

The same sort of moralizing critics appeared then, to castigate those involved in production and consumption of alcohol as immoral and sinful. Rallies of revivalist character presented the temperance movement to the public as an ideology that became almost a religion. There was good reason for this sincere zeal - certainly the behavioral and health issues caused by excessive alcohol consumption were of far greater social importance than those caused by illicit excavation and smuggling of artifacts. After their campaign to prohibit the production and consumption of alcoholic beverages succeeded, however, temperance ideologues were dismayed to discover that Prohibition turned out to be a monumental, disastrous failure. Even they could clearly see that very little good and a great deal of harm had been caused by their unrealistic campaign to legislate morality. In the end many of those who led the effort to impose Prohibition in 1919 supported the campaign to repeal it in 1933.

Should present-day activists ever succeed in enacting legislation restricting (and ultimately ending) the international trade in ancient artifacts such as coins, and their possession by private collectors, there is no doubt in my mind that such anticollecting laws would be even more impossible to enforce than the Volstead Amendment. Coins are much smaller that containers holding equivalent values of alcoholic beverages. They can readily be concealed in what appear to be ordinary letters sent through the international postal system without declaration of contents. It would not be feasible to intercept any significant fraction of coins illicitly mailed, and there would be other ways to bring them across the porous borders of nations such as the United States. If the US cannot even stop illegal immigration, how can anyone imagine that it would be possible to prevent illicit entry of small objects such as coins?

I doubt however that the obviously inevitable failure of "coin Prohibition" would be similarly recognized and responsibly admitted to by the moralists presently campaigning for its enactment. They are not motivated by the sincere social concerns of the Temperance Movement, but by an ideology founded upon the notions that archaeology is the most important human activity and that State Socialist principles should apply to possession of ancient artifacts, which must be kept in institutional and public custody.

These principles are sincerely held by anticollecting activists, but I believe they would be much less likely to be accepted by the public than the principles of the Temperance Movement. Given the extreme ease with which coins can be safely concealed and distributed compared to containers of alcoholic beverages - and the prospect of far less public support for "coin Prohibition" - how can anyone imagine that this would have any chance of success?

There would however be significant negative effects from criminalizing the private possession and distribution of ancient coins, just as there were negative effects from criminalizing the private possession and distribution of alcoholic beverages. Collectors would be faced with the dilemma of having to cease their collecting activities (and perhaps even surrender their collections) or become criminals, while law-abiding dealers such as myself would face a similar dilemma. I personally would not even consider breaking the law, but others in different circumstances might find that a more difficult decision. During Prohibition, many of those involved in the previously licit distilling and liquor distribution industries were put out of work under economic circumstances such that alternative employment was not available. In many cases they became moonshiners or rumrunners, not because they were criminals by inclination, but because the alternative was starvation for themselves and their families.

Those who did not have an opportunity to watch this show can acquire it as a DVD recording as I have myself done, by ordering it from the A&E website. It is "mandatory watching" for everyone on every side of the present controversy over collecting ancient coins. I especially commend it to those advocating anticollecting views in the hope that they may come to realize how far divorced their expectations are, from what would actually occur if they got what they presently think they want.

A link to the A&E website page where this DVD can be ordered is given below, along with the text of its description of the DVD.


Veterans from both sides of the ''Rum Wars'' share Prohibition tales and reflect on the legacy of the Roaring Twenties.
They raced through the back roads and sailed the high seas for a decade, delivering a precious liquid cargo to a nation whose thirst could not be quenched by legislation. From high-toned clubs and hidden speakeasies to backwoods shacks, Prohibition did little to stop America's consumption of liquor--it just diverted the flow to different channels.

RUMRUNNERS, MOONSHINERS AND BOOTLEGGERS revisits the rough-and-tumble days of Prohibition for a candid, inside look at the legacy of this tumultuous time. Former Rumrunners talk of their run-ins with the Coast Guard, and we'll see how NASCAR owes its existence to the failed attempt to dry out the nation. Authors like Philip P. Mason (Rumrunning and the Roaring Twenties) and Gary Regan (The Book of Bourbon) provide a historical perspective, while retired agents and prosecutors reflect on their difficult, dangerous and ultimately futile efforts to enforce a law that America clearly did not support.
Filled with extraordinary tales, rarely-seen footage and a host of captivating photos, RUMRUNNERS, MOONSHINERS AND BOOTLEGGERS is an unforgettable portrait of one of the most compelling eras in our history.