ASM #252 CGC 9.8 Record Sale - something fishy going on? - Holder Tampering Incident confirmed by CGC 50 50

[sledgehammer]

Somebody changed the date to limit the time lapse between sign date and grade date?

Edited February 7 by sledgehammer
limit

[paqart]

On 2/7/2024 at 4:24 PM, comicwiz said:

 

When I think of a counterfeit, I'm thinking a guy in Lima in a storage locker with a Heidelberg printing press that has replicated a US $100 bill to an exactness that is near impossible to distinguish between real and fake. A counterfeit is not some insider at the US Mint, who runs notes while no one is looking, or strikes builion on planchets he snags when no one is looking.  One is an imitation, the other is not.

A "counterfeit" is something that has been manufactured, assembled, or labeled deceptively, for the purpose of persuading others that it is something it is not, usually an item of higher value. In the case of counterfeit money, it is paper manufactured to make it look like genuine currency. With a knockoff Rolex, it has a fake embossed logo added to a watch that is not a Rolex. The logo is real, the watch is real, but the watch isn't a real Rolex. A painting by a follower of a well-known artist might have his name covered up or scraped away from a painting to make it look like it is by the master (who doesn't sign his work.) It is a real painting but it isn't by the person who purportedly made it. This is distinct from a "forgery" where an attempt is made to imitate the artist's style.
What we have here are counterfeits of the knockoff Rolex variety. It isn't that any of the elements are counterfeit, but that their unique assembly is a counterfeit because it falsely represents the contents of a slab as something other than what it is. The false certification number (because it doesn't apply to the comic inside) is clever, because it is a real number belonging to a different comic. 
Sometimes diamonds are micro-etched with ID numbers. If someone had a list of ID numbers and the gems they were associated with, then found similar gems and infiltrated them into an order at the company that does the order, they would end up with counterfeits due to the substitution. That is exactly what happened here.

Edited February 7 by paqart

[comicwiz]

On 2/7/2024 at 4:38 PM, paqart said:

Sometimes diamonds are micro-etched with ID numbers.

Lab created, but not old mined. Lab created are supposed to laser etch on the girdle, but dishonesty is an issue on those that pass through without.

On 2/7/2024 at 4:38 PM, paqart said:

What we have here are counterfeits of the knockoff Rolex variety.

I don't see that at as being the same as this incident. Not even close to being the same in terms of comparison. 

No one has knocked-off the holder (as far as I can tell from the pics I've looked at), no one has knocked off the inner well. No one has knocked off the label, although they may have been able to print on it incorrect information. Happens with errors too, those aren't counterfeits. 

The intent to decieve happened with access to the same equipment used to grade/holder/label real. The key differentiator is that if I send in a fake Rolex to them to authenticate, it would never pass. Here, the book was sent in and was deemed fit for reholdering, in some instances photographing for their certification look-up, and returning it to the customer as passing all the checkboxes of it being an authentic product.

It only was deemed "tampered" after WE compared before and after pics, as well as tracking the changes of the book inside with each repeat appearance during it's entire sales history cycle.

Edited February 7 by comicwiz

[paqart]

On 2/7/2024 at 4:50 PM, comicwiz said:

 

It only was deemed "tampered" after WE compared before and after pics, as well as tracking the changes of the book inside with each repeat appearance during it's entire sales history cycle.

This is what the Bard chatbot has to say about it:
 

Arguments for calling it "counterfeit":

• Deceptive intent: While not a perfect replica, the act involved creating a deceptive representation of the comic's value by swapping it with a lesser-valued one within the certified case. This aligns with the core principle of counterfeiting, which seeks to deceive buyers into believing something is more valuable than it actually is.
• Misrepresentation of origin and value: The CGC case and label, now attached to the wrong comic, misrepresent the origin and value of the contents. This echoes the element of counterfeiting where fake items are presented as genuine to inflate their perceived worth.
• Legal precedent: Considering CGC itself uses "counterfeit" in their lawsuit, legal arguments and definitions might support this terminology.

Arguments against calling it "counterfeit":

• Technical definition: As you mentioned, individual components (case, label, comic) are genuine, even if their combination is fraudulent. This deviates from the stricter definition of "counterfeit," which often implies complete replication of the original.
• Degree of replication: Unlike classic counterfeiting, the deception doesn't involve replicating the original comic itself, but manipulating existing elements (case and label) to misrepresent its contents. This distinction could warrant a different term.

Alternatives and considerations:

• Fraud: This continues to be a strong option, emphasizing the deceptive intent and act without getting bogged down in technicalities of replication.
• Tampering: While accurate, it might not fully capture the deceptive element and the intent to mislead buyers.
• Misgrading: This specifically addresses the manipulation of the grading system but doesn't encompass the broader act of deception with the case and label.
• Hybrid terms: Combining terms like "fraudulent reholdering" or "counterfeit relabeling" could offer more specific descriptions while acknowledging the unique aspects of this case.

Ultimately, the choice of term depends on the specific emphasis you want to convey and the context of your discussion. Consider the following:

• Target audience: If you're addressing a general audience, "counterfeit" might be easier to understand, even if technically imperfect. If your audience is familiar with legal nuances or comic book collecting, a more specific term like "fraudulent reholdering" might be better.
• Desired focus: Do you want to emphasize the overall act of deception, the manipulation of the grading system, or the specific use of genuine components in a fraudulent way? Choosing a term that aligns with your intended focus will improve clarity.

[paqart]

On 2/7/2024 at 4:50 PM, comicwiz said:

 

It only was deemed "tampered" after WE compared before and after pics, as well as tracking the changes of the book inside with each repeat appearance during it's entire sales history cycle.

This is Bard's answer to you:
 

This response seems to argue against using the term "counterfeit" for the CGC reholder scandal. Here's my analysis of the main points:

Points against "counterfeit":

• No replication: None of the physical components (holder, label, comic) are themselves replicas. They are all genuine CGC elements.
• Intent and opportunity: While deception was involved, it relied on manipulating existing elements, not creating replicas. They didn't "knock off" any component.
• CGC's role: The comic was initially authenticated as genuine by CGC, potentially adding confusion to the term "counterfeit."

Additional points to consider:

• Focus on authenticity and manipulation: This perspective emphasizes the manipulation of the system and label information, rather than creating replicas.
• Internal comparison: Drawing a distinction between external counterfeiting (like fake Rolexes) and internal manipulation within a trusted system strengthens the argument against "counterfeit."
• Detection after the fact: Highlighting the need for post-grading comparisons suggests it might not fall under the traditional definition of "counterfeit" immediately discovered during authentication.

Overall, this response offers a valid perspective against using "counterfeit" for the CGC reholder scandal. It shifts the focus towards manipulation and deception within a trusted system, potentially suggesting alternative terms like "fraudulent relabeling" or "misgraded reholdering" for better accuracy.

______________________________________

Back to me:
I see your point, but our difference of opinion is coming from our focus. You are looking at how it was made, I am looking at how it is presented to customers. To a buyer, these are counterfeits because they aren't what they purport to be, though they look genuine thanks to the genuine parts. You are saying it isn't a counterfeit because the comic is genuine and CGC assisted, meaning all genuine parts. The term "counterfeit" is designed to have meaning in the context of customer deception, not to describe how something is manufactured.

[comicwiz]

On 2/7/2024 at 4:57 PM, paqart said:

This is what the Bard chatbot has to say about it:
 

Arguments for calling it "counterfeit":

• Deceptive intent: While not a perfect replica, the act involved creating a deceptive representation of the comic's value by swapping it with a lesser-valued one within the certified case. This aligns with the core principle of counterfeiting, which seeks to deceive buyers into believing something is more valuable than it actually is.
• Misrepresentation of origin and value: The CGC case and label, now attached to the wrong comic, misrepresent the origin and value of the contents. This echoes the element of counterfeiting where fake items are presented as genuine to inflate their perceived worth.
• Legal precedent: Considering CGC itself uses "counterfeit" in their lawsuit, legal arguments and definitions might support this terminology.

Arguments against calling it "counterfeit":

• Technical definition: As you mentioned, individual components (case, label, comic) are genuine, even if their combination is fraudulent. This deviates from the stricter definition of "counterfeit," which often implies complete replication of the original.
• Degree of replication: Unlike classic counterfeiting, the deception doesn't involve replicating the original comic itself, but manipulating existing elements (case and label) to misrepresent its contents. This distinction could warrant a different term.

Alternatives and considerations:

• Fraud: This continues to be a strong option, emphasizing the deceptive intent and act without getting bogged down in technicalities of replication.
• Tampering: While accurate, it might not fully capture the deceptive element and the intent to mislead buyers.
• Misgrading: This specifically addresses the manipulation of the grading system but doesn't encompass the broader act of deception with the case and label.
• Hybrid terms: Combining terms like "fraudulent reholdering" or "counterfeit relabeling" could offer more specific descriptions while acknowledging the unique aspects of this case.

Ultimately, the choice of term depends on the specific emphasis you want to convey and the context of your discussion. Consider the following:

• Target audience: If you're addressing a general audience, "counterfeit" might be easier to understand, even if technically imperfect. If your audience is familiar with legal nuances or comic book collecting, a more specific term like "fraudulent reholdering" might be better.
• Desired focus: Do you want to emphasize the overall act of deception, the manipulation of the grading system, or the specific use of genuine components in a fraudulent way? Choosing a term that aligns with your intended focus will improve clarity.

What's lacking here is that an assessment done by the company who grades/authenticates gave the book a stamp of approval. No one forced CGC to hurriedly carry out it's assessment during the reholdering, no one forced their hand to have the book returned in a manner that caused them to not perform a proper and accurate assessment.

On the contrary, as a consumer, I would argue that it's encumbent on CGC to ensure these items are accurately assessed, especially in instances were defects such as those posed by a missing MVS be carried out in a rigourous and exhausting manner that includes interior inspection, rather than rushed, causing incomplete comics to go from qualified designation to universal. 

The fact these books passed through enabled the bad actor to carry out their alleged criminal activity. Hundreds of books if we go by CGC's impacted list. All could have been averted if the reholder process included with it the proper assessment to catch the scheme. 

Edited February 7 by comicwiz

[paqart]

On 2/7/2024 at 5:04 PM, comicwiz said:

 

The fact these books passed through enabled the bad actor to carry out their alleged criminal activity. Hundreds of books. All could have been averted if the reholder process included with it the proper assessment to catch the scheme. 

I agree with all of this. I disagree about the term "counterfeit." From a buyer's perspective, that's what it is, no matter how it came to be. It isn't a "counterfeit Incredible Hulk 181" (or whatever), but a "counterfeit CGC 9.0 Incredible Hulk 181."

[comicjel]

On 2/7/2024 at 4:28 PM, sledgehammer said:

Something weird.

On the pressing site, before and after examples, a 4.5 FF book, becomes a 5.0 book.

Both slabs are yellow. Signature is exactly the same.

The after slab is custom Stan label. 

Cream OW becomes OW.  Not that big of a deal.

The weird thing is that the date Stan signed it changes from  11/23/2013, to  4/22/2017.

Probably a mistake?  Just seems very weird to be a mistake

Before  https://www.cgccomics.com/certlookup/1196041008/.

After  https://www.cgccomics.com/certlookup/1393257001/

I think you have discovered something very important here!!

How does one press a SS book with a 3rd party presser and resub it and still get a SS label back?? - doesn't that break some chain of custody with the signature witnessing??

This implies that CGC accepted the signature as legit somehow without getting the book back in the original CGC holder - all kinds of problems with this!

I think you have found a new aspect to the scamming.

 

[awakeintheashes]

On 2/7/2024 at 5:19 PM, comicjel said:

I think you have discovered something very important here!!

How does one press a SS book with a 3rd party presser and resub it and still get a SS label back?? - doesn't that break some chain of custody with the signature witnessing??

This implies that CGC accepted the signature as legit somehow without getting the book back in the original CGC holder - all kinds of problems with this!

I think you have found a new aspect to the scamming.

 

Until recently, there were some who were authorized by CGC to crack open and work on SS books and they would retain the yellow label. I’m not sure when this changed as I don’t collect signed books.

Edited February 7 by awakeintheashes

[comicjel]

On 2/7/2024 at 4:31 PM, sledgehammer said:

Somebody changed the date to limit the time lapse between sign date and grade date?

If so, good thing it was not graded in 2019!

[agamoto]

On 2/7/2024 at 1:38 PM, paqart said:

 That is exactly what happened here.

@comicwiz beat me to it, but I agree with him, that's not what happened here.

Since you used Bard, I thought it would be fun to feed this scenario to ChatGPT4 and see what it craps out:

***

Under the Lanham Act, specifically 15 U.S.C. § 1116(d), "counterfeit" is defined in the context of civil remedies for trademark infringement, particularly focusing on counterfeit marks. While the Act itself is extensive and covers a broad range of trademark law aspects, the specific definition of a "counterfeit" mark relates to a mark that is unauthorized and identical with, or substantially indistinguishable from, a registered mark. The key aspect of a counterfeit mark under the Lanham Act is its use in connection with the sale, offering for sale, or distribution of goods or services, which is likely to cause confusion, mistake, or deception.

Definition Overview:

Unauthorized: The production or use of the mark is without the permission of the trademark holder.

Identical or Substantially Indistinguishable: The counterfeit mark must be so similar to the genuine registered trademark that it is likely to deceive or cause confusion among consumers about the source of the products or services.

Registered Mark: The genuine mark must be registered with the United States Patent and Trademark Office (USPTO).

Likelihood of Confusion: The use of the counterfeit mark is such that it would likely cause confusion or mistake, or deceive consumers as to the origin, sponsorship, or approval of the goods or services by the trademark holder.

This definition targets the replication of trademarks for use on unauthorized goods or services, intended to deceive consumers into believing they are purchasing legitimate products endorsed or produced by the trademark holder.

Application to the Scenario:

Given this definition, arguing that a lower-grade book submitted for grading is a "counterfeit" under the Lanham Act would require demonstrating that:

The submission involved the use of a mark that is identical or substantially indistinguishable from the grading company's registered trademarks.

The mark was used without authorization in a manner likely to cause confusion or deceive about the authenticity or quality of the book as certified by the grading company.

However, if the grading company itself applied the mark based on its reassessment process, the situation doesn't straightforwardly fit the concept of "counterfeiting" as defined, since the issue stems more from the exploitation of the company's certification process rather than the unauthorized or deceptive use of a counterfeit mark.

In legal strategy, focusing on the deceptive practice or potential for consumer confusion resulting from the misrepresentation of the item's condition might be more applicable under claims of false designation of origin or false advertising, rather than strictly under the definition of counterfeiting.

The grading authority, by promising authentication and certification of items (such as comic books, collectibles, etc.), assumes several responsibilities under both the legal framework of trademark law and general principles of consumer protection. Their role and the assurances they provide create expectations among consumers and stakeholders about the accuracy, reliability, and integrity of their grading and authentication services. Here's how their responsibilities play out, especially in light of the scenario where their process has been exploited:

Legal and Ethical Responsibilities

Accuracy of Grading and Authentication: The grading authority is responsible for ensuring that the grading and authentication processes are conducted accurately and reliably. This includes employing experts, using appropriate technologies, and applying consistent standards to evaluate the items submitted for grading.

Misrepresentation and Deception: The authority must avoid any actions or practices that could mislead consumers about the quality, condition, or authenticity of the items they certify. This involves clear communication about what their certification represents and any limitations of their assessment process.

Consumer Confidence and Trust: By offering a certification service, the authority implicitly promises to uphold a level of trust with consumers. They are responsible for maintaining this trust by ensuring their certification accurately reflects the item's authenticity and quality.

Response to Exploitation or Fraud: If the grading authority's process is exploited or circumvented (as in the scenario of items being swapped and misrepresented), they have a responsibility to address the issue promptly. This could involve investigating the breach, improving security or assessment measures, and taking corrective actions to rectify any misissued certifications.

Transparency: The authority should be transparent about their grading process, including any changes or updates to their criteria. This transparency helps consumers make informed decisions and maintains the credibility of the authority's certifications.

Legal Compliance: The grading authority must comply with all relevant laws and regulations, including those related to consumer protection, trademark law, and fraud. This compliance is crucial to avoid legal liabilities and maintain their operational legitimacy.

Countermeasures and Improvements

In response to exploitation or to prevent future incidents, the grading authority might consider implementing several measures:

Enhancing Verification Processes: Improving the thoroughness and accuracy of the re-authentication process to detect tampering or misrepresentation.

Technology Upgrades: Using advanced technologies for tamper-evident seals, digital tracking, or other means to ensure the integrity of the item and its certification.

Education and Awareness: Informing customers about how to verify the authenticity of certifications and the risks of counterfeit items.

Legal Action: Pursuing legal remedies against individuals or entities that fraudulently exploit the certification process.

Partnerships: Collaborating with law enforcement, other grading authorities, and industry groups to address broader issues of fraud and counterfeiting in the collectibles market.

The grading authority's responsibility is not only to their direct customers but also to the wider community of collectors, investors, and enthusiasts who rely on their certifications as a benchmark of authenticity and quality. Addressing any exploitation of their process is crucial for maintaining the value and integrity of their service.

***

I can't wait for the day we have robot lawyers duking it out in court! 

400 pages in and we're back to this being an AI discussion!

[MAR1979]

On 2/7/2024 at 5:04 PM, comicwiz said:

What's lacking here is that an assessment done by the company who grades/authenticates gave the book a stamp of approval. No one forced CGC to hurriedly carry out it's assessment during the reholdering, no one forced their hand to have the book returned in a manner that caused them to not perform a proper and accurate assessment.

On the contrary, as a consumer, I would argue that it's encumbent on CGC to ensure these items are accurately assessed, especially in instances were defects such as those posed by a missing MVS be carried out in a rigourous and exhausting manner that includes interior inspection, rather than rushed, causing incomplete comics to go from qualified designation to universal. 

The fact these books passed through enabled the bad actor to carry out their alleged criminal activity. Hundreds of books if we go by CGC's impacted list. All could have been averted if the reholder process included with it the proper assessment to catch the scheme. 

I do wonder how that would play out in front of a Jury? But we'll never know as the defendants actually showing up or responding in any manner is pigs fly territory.

[comicwiz]

On 2/7/2024 at 6:04 PM, agamoto said:

However, if the grading company itself applied the mark based on its reassessment process, the situation doesn't straightforwardly fit the concept of "counterfeiting" as defined, since the issue stems more from the exploitation of the company's certification process rather than the unauthorized or deceptive use of a counterfeit mark.

THIS

[paqart]

On 2/7/2024 at 6:04 PM, agamoto said:

@comicwiz beat me to it, but I agree with him, that's not what happened here.

Since you used Bard, I thought it would be fun to feed this scenario to ChatGPT4 and see what it craps out:

 

***

I can't wait for the day we have robot lawyers duking it out in court! 

400 pages in and we're back to this being an AI discussion!

I see your point, and have seen it, as well as @comicwiz from the beginning. "It isn't what happened" is different from "That's no what it is." The slabbed comics are counterfeited CGC-graded comics because they weren't graded by CGC. CGC's reholdering process was exploited to obtain that result, but the end result is the same, regardless. This only applies to the reholdered comics btw. Comics that were directly swapped out by the perps are also counterfeit CGC-graded comics, though it is easier to see with those.

[paqart]

On 2/7/2024 at 6:08 PM, comicwiz said:

THIS

They applied the mark without grading the comic. Therefore, it is not a "CGC-graded comic". That makes it counterfeit.

[comicjel]

On 2/7/2024 at 5:31 PM, awakeintheashes said:

Until recently, there were some who were authorized by CGC to crack open and work on SS books and they would retain the yellow label. I’m not sure when this changed as I don’t collect signed books.

If CBS was given this type of authorization, then maybe they were also authorized (trusted) to just send in reholder books with a loose label?

[comicwiz]

On 2/7/2024 at 6:12 PM, paqart said:

They applied the mark without grading the comic. Therefore, it is not a "CGC-graded comic". That makes it counterfeit.

I realize I'm not going to change your mind, but I'm going to share with you an incident that helps illustrate why it is.

Years ago, I did an estate appraisal which contained among many items, some RCM issued coin rounds. These coin rounds were something I had appraised in the past in other estates. They are inside capsules, and placed inside an RCM box with a certificate. The capsules act as a hinderance to be able to do a proper assessment. Most people prefer them not to be opened, making it difficult to test for precious metal purity and weight. A few years prior I had appraised a collection that contained similar items, and was in contact with RCM, who provided me with valuable information, which included the weight of the capsule. Interestingly enough, I got the idea when NGC had announced many years back of counterfeit slabs, and I contacted NGC back them to get the weight of their coin slabs, to help me appraise some NGC graded items at that time as well.

So with the weight of the capsule, as well as measuring the radius, circumference and thickness of the coin, I was able to determine they could not be authentic gold coins. Gold's density is impossible to replicate without altering the specifications of the coin round or builion. If you know this information, and it's straight from the source, you have all you need to perform the assessment. It's never easy to break the news to the owners, but that discovery led to a massive investigation that shook out the perps, who had managed to somehow secure dies, stamping equipment, boxes, certs and capsules. I've examined counterfeits before, these were very convincing, and if not for their choice of using a filler metal, I might not have ever noticed. The one thing that allowed them to pull it off as convincingly is that they actually used real boxes, certs and capsules. The capsules were the barrier for most to figure out the weight, and my thoroughness and insistence on accuracy is what led to them being busted.

Similarly, it's the holder and inner well that obstructed CGC from performing the assessment they needed to. They can't use weight or measuring their contents because of the variability of the material they are encapsulating. And on books requiring an interior inspection, they needed to make sure that what was inside was a complete book, or even examine the book inside the well to see it matched the grade on the label. The decision to handle reholders the way they did, absent of a thoroughness and insistence on accuracy, is what led to the exploitation to occur, and continue for as long as it did. AND until we caught it, it was very much a CGC graded comic. 

Edited February 7 by comicwiz

[agamoto]

On 2/7/2024 at 3:08 PM, comicwiz said:

THIS

On 2/7/2024 at 3:12 PM, paqart said:

They applied the mark without grading the comic. Therefore, it is not a "CGC-graded comic". That makes it counterfeit.

Except the lower grade comics that were substituted into the higher grade cases were, in fact, graded by CGC. That's one of my beefs with the way the complaint was written as they clearly are sidestepping the very important detail about the donor books... They weren't simply pulled off the $1 bin rack from some comic store, they were CGC authenticated genuine books still encased in their inner-sleeve. 

Also, their own description of the reholdering process indicates they remove the comic sent in from the case and the inner sleeve and the book is assessed prior to being re-encapsulated again. 

[paqart]

On 2/7/2024 at 6:30 PM, comicwiz said:

it was very much a CGC graded comic. 

How is it "CGC graded" if CGC didn't grade it? They reholdered it, had a responsibility to at least examine it, but they didn't re-grade it and may not have originally graded the comic if it had ever been graded in the past before the swap. In your coin example, I was waiting for you to say that law enforcement determined they weren't counterfeits, but then saw they absolutely were due to the adultered metal. However, there are many ways to make a counterfeit.

I'm not sure these distinctions matter at all, because your concern seems to center on CGC's responsibility in this, whereas my interest is in a correct label from the customer point of view, which is likely how CGC's lawyers are viewing it.

You may well be right, though we now live in an age when many words now mean the opposite of what they meant 40 years ago. In this case, we agree the combination of elements were assembled for the purpose of committing fraud. It would not have happened but for the actions of the perps involved. Something at CGC allowed it to happen. Personally, I am not yet convinced there wasn't an inside man on this. It looks more likely to me that there was. At that point, would you accept the term "counterfeit" because the intent of all parties involved was to fraudulently create the appearance of a CGC comic?

BTW: If I was on a jury for this case and the verdict depended on this definition, I'd stick to my guns that it was counterfeit. I'm retired and would be happy to stick it out as long as it takes, or until a better argument is offered.

[paqart]

On 2/7/2024 at 6:31 PM, agamoto said:

Except the lower grade comics that were substituted into the higher grade cases were, in fact, graded by CGC. That's one of my beefs with the way the complaint was written as they clearly are sidestepping the very important detail about the donor books... They weren't simply pulled off the $1 bin rack from some comic store, they were CGC authenticated genuine books still encased in their inner-sleeve. 

Also, their own description of the reholdering process indicates they remove the comic sent in from the case and the inner sleeve and the book is assessed prior to being re-encapsulated again. 

They may have been graded at one time, but not on the occasion when they received a grade bump. If you buy an Action #1 graded at 1.5, it is CGC-graded. If you break it out of the case, it was CGC-graded. If you slip it into a case with a 9.0 label, CGC did not grade it 9.0. Therefore, in that holder, it is no longer CGC graded. Breaking it out of the original holder is like nullifying a marriage: it is as if it had never happened. Saying that someone whose marriage was annulled is now married to someone else on the basis that the names on the marriage certificates match, when the person involved is not the same, does not make them married.