Thursday, October 17, 2013

A Couple Of Black Eyes For The Hobby

Trimmed cards, shill bidding, questionable grading and fake jerseys are bad news for the hobby.
In July 2012, after three years of investigations, the FBI released indictment charges against Bill Mastro, the founder/CEO of Mastro Auctions. He was charged with 14 counts of wire and mail fraud, charges which he finally pleaded guilty to last Thursday (10/10/13). The charges indicated that Mastro (and some of his employees) misrepresented some items and were involved in shill bidding to inflate the prices of certain collectibles. Some claims have also been made that Mastro and PSA worked “favorable” grading for certain items. This leads to the McNall-Gretzky Honus Wagner card that was graded a PSA 8 in 1991, which also happens to be PSA’s first graded card ever.
There is a very interesting 28-year history to the Wagner card, to keep it short I will go with the abbreviated story, if you want to read more on the history of the card you can check out the background story from the March 25, 2001 story in the NY Daily News archives or Keith Olbermann’s personal blog. For some very good additional reading check out the Hauls of Shame, I came across quite a bit of the trackable history of the card along with a picture of the Eddie Plank card from the same printers sheet.
Abbreviated story: The owner who sold the card to Mastro in 1985, Alan Ray, acknowledges that the card came from a printer's sheet. He states he did not cut the card from the sheet but when he sold it to Mastro it had oversized edges with rounded corners. He even has pictures of the card showing that it was much larger before he sold it to Mastro. When McNall bought the card in 1991 he had two reputable people (including Keith Olbermann) verify the authecity of the card. Both stated that they believe the card had been trimmed. McNall himself agreed but bought the card anyway and thus beguns the meteoric rise of the most (in)famous card.

So let’s fast forward to July 2012, Mastro is indicted for all his stupid shiznat. April 2013 he tries to work a plea bargain but U.S. District Court Judge Ronald Guzman tells him “No way”, he appears in court last week and finally admits guilt on all counts including that he trimmed the Wagner card. He now faces up to 5 years in prison.
So now that Mastro has been implicated where does PSA stand? It is likely that they knew the card was trimmed but if they acknowledge it now they will be destroying the company’s integrity as an authority in sports cards. If they claim they were innocent they appear ignorant and leave questions about all of the cards they have graded since 1991.
So there we have black eye number one.
Now we find out that 5 dealers that had been working directly with the major sports card companies have been supplying fake jerseys to be used in memorabilia cards. Topps, Upper Deck and Donruss have all been identified as receiving fake jerseys.
This has actually been in the court systems since 2011 but we are now finally getting closure. The first two dealers, Steve Jensen and Bradley Wells, got a slap on the wrist for their indiscretion, one got 6 months in jail and the other probation. The other three are awaiting their punishment trial on October 26th.
Sadly Wells stated during his trial that the companies he worked with had to know the jerseys were not real because of the low price he was charging them. I guess that would be part of the reason he was the one who got the six month jail time instead of only probation. Based on his logic it would be like selling the Mona Lisa, painted by your 6-year old nephew, as authentic but charging only $500,000 and saying the buyer should have known the difference.

So there is black eye number two
To make the hobby look even worse is that Panini has already filed a $10 million+ claim against Jensen and Wells. They are claiming that the amount represents what the value of the jerseys would have been had they been real.
According to the FBI report that was released with court documents yesterday states that when Panini purchased the Donruss name they inherited $125,908 worth of relics, which most had already been cut up and ready for insertion in to cards to be distributed. I think we can safely assume that Panini (unknowingly) has inserted most, if not all, of these relics in to cards which have since been packed out. If these relics have all been distributed since 2009, when Panini bought Donruss, than they have not lost any money.
Time for another analog (Using Panini’s logic this time), your great-aunt Meredith buys a box of cards at a yard sale for $12.59 that she leaves you in her will, you then sell those cards for a small profit to a card shop. You then go back and sue the people running the yard sale for $1,000 because the cards were fake even though you made money selling the cards yourself..

OK, my rant is done

1 comment:

  1. When are poeple going to realiaze PSA and other card companies are not iinterested in furthering the hobby, but lining their pockets. Read the book "The CARD" for an in depth look at the fraud laid upon the hobby by these gangsters.

    I know from fist hand that Upper Deck was cheating on the jerseys as I worked with the pro clubs and players in one of the leagues.

    I could cut up a nice replica jersey and some collector will pay $100 for the crest from my $50 "athenticated" shirt.