by Donald E. Willis, Jr

     On March 25, 2010 PCGS unveiled “The Big One.” After months of anticipation, PCGS Secure Plus was launched at the ANA Money show in Fort Worth, Texas to a crowd of eager collectors, dealers, numismatic press and industry leaders. Over the next 90 minutes, David Hall and I introduced the new program and tried to share as many program details as possible followed by answering as many questions from the audience as time allowed. What we attempted to explain in 90 minutes took PCGS well over a year to develop. In the days following the announcement, many began to contemplate the new program. Lots of new issues came to light that gave rise to additional questions. Hopefully, this short article will help answer many of those questions and perhaps address a few additional issues that haven’t yet been raised.
     The very first conversations that eventually led to PCGS Secure Plus started off with the idea that we needed to do something to stop coin doctoring. Everything has to start somewhere, but we thought if we could tell whether we had previously seen a coin and be able to compare images and grading results from submission to submission we could get a leg up on the coin doctors. Over the years, we have occasionally been fooled by grading a nice white coin, only to have that same coin come back a few months later with very realistic toning and receive a higher grade. On more than one occasion, PCGS has had to step up and buy that artificially toned coin, and take it off the market. The same goes for coins that had been puttied or had hand cream or dum-dum or a thousand other substances applied. Over the past 24 years, PCGS has spent over $7 million removing problem coins from the market!
     We needed a system that would recognize a coin regardless of what had been done to it. One of our earliest meetings was with Richard Haddock. Richard is an extraordinary inventor who immediately understood the issue. Richard and his staff’s engineering expertise were instrumental in developing the core technology that forms the basis of Secure Plus. Going into this project, PCGS was keenly aware of all the issues that needed to be addressed and the possible measures coin doctors would take to confuse and trick the system. Also, PCGS has developed considerable expertise in Enterprise applications and scaleable systems while supporting our business of grading tens of thousands of coins every week—over 20 million so far!
     We spent many months performing thousands of tests as we fine-tuned the technology and created the overall system. The objective of testing is to break a system or at least to find its weaknesses – not to prove it works. Rigorous testing leads to further refinements and strengthening until the system is virtually unbreakable. (We are not going to claim perfection, even though we can’t break it. We believe we can achieve our objective of hampering the coin doctors with a system that is “near” perfect.) Together, Richard, through his company, Coin Secure, and PCGS co-authored seven patents covering this technology. It is much easier to understand PCGS Secure Plus if you separate the two major components in your thinking. Let’s first examine the Secure portion, followed by the Plus portion. The Secure aspect is the part of the system that creates a unique record for each coin and recognizes if it has been previously submitted. By itself, the Secure component offers a huge benefit to the collecting community. When a coin is submitted for grading through Secure Plus, it is placed inside a small machine that looks like an old single-CD player. Inside this machine, some magical things happen. The entire process is controlled by the system’s software that tells the operator what kind of coin he should be processing and how to align the coin, adjusts the lasers, lighting and camera, and controls the work flow that the operator and machine perform. Once the coin is loaded into the machine, multiple imprints of the coin’s surfaces are created by dozens of laser scans. These imprints are then digitized and recorded in a database. The coin is digitally photographed which is stored as part of the overall record as well. There are a lot of special tricks that are part of this “magic” but we are not going to divulge what those are. Suffice it to say that there are many levels of defense that exist within the system since we fully expect it to be tested by the very coin doctors we will soon be helping find more honest work.
     Just like humans, coins have a unique fingerprint. The Secure process reads that fingerprint and stores it. Let’s call that stored record a coinprint. Just as there is a great amount of information in a fingerprint, there also is in a coinprint. When the FBI searches for a fingerprint, they can positively match on just a small portion of the print. The same applies to a coinprint. Once a coin has been scanned, the coinprint is then sent into a matching process. During this process, the coinprint just taken is matched against all the possible matches in our database. When a match does occur, the correlation between the two coinprints is very high, usually well over 90%. We have tested this process thousands of times with all types of coins. We have colored the coins, covered them in various substances, scratched and marked them up. Basically, we recreated every trick that we’ve had used on us over the years. The Secure process was able to see through all those alterations and identify the original coin every time. Just like the criminal that burns his fingerprints off with acid to avoid identification, we were able to alter a coin enough that it would not be recognized. However, in the process the coin was destroyed, and would never grade, so it became a moot point.
     When a coin is matched, its record is flagged for the verifier. However, during grading, the graders do not know if a coin has been matched. Allow me to digress for a moment and explain how the grading system works. Knowing this will answer many people’s questions about Secure Plus. When a coin is submitted for grading, it can be done one of two ways (we will ignore Crossovers for this discussion). Either the coin is raw, or it is in a holder. If the coin is in a holder, the first thing we do is check the holder to make sure it has not been tampered with and that it is not a counterfeit. Once that is done, the coin is cracked out and is treated exactly the same as a raw coin submission. When a grader is given a coin to grade, that coin is raw. The grader does not know if the coin is a regrade or a “raw” submission. The graders do not know if a coin has ever been previously submitted. Grader number one grades the coin. Then grader number two grades the coin. If they both grade the coin exactly the same, the coin goes to the verifier for finalization. If the graders do not agree exactly on the grade, the coin goes to a third grader and then to the verifier. Nowhere in this process do the graders know what grade any of the other graders have given the coin or what, if any, grade the coin may have had in the past. Our objective at PCGS is to grade every coin properly. That means giving every coin the highest grade that it deserves. It is incorrect to assume that a coin’s grade cannot change through Secure Plus. Yes, there are a lot of reasons a coin’s grade will no longer change because we can now catch the trickery and deception that goes on, but every coin gets an honest and objective review and grade. Grade changes can happen, although we believe they will be far fewer than in the past.
     When the coin is finalized, the verifier sees the grades given to the coin by all the graders. If the coin has come through Secure Plus and a match has been found, he is shown the coin’s grading record which includes its previous grade(s) and photograph(s). He can then compare these to the current grades and photograph. Through magnification software it is quite easy for the verifier to compare the coin photographs and decide if the coin has been altered in any way (of course he has it in hand as well). If the coin has been altered, it will not receive a PCGS grade. If the coin has not been altered, it will be graded according to our standards. The verifier also is told what type of submission the coin came in on. For example, he can see if the coin came back for a regrade vs. a raw submission. I believe that having access to all this information is a great aid in grading, and will help PCGS perform at a consistently high level.
     The Secure process is already helping PCGS catch coins that have been altered. It is working, and we are catching coin doctors in the act. Over time, the Secure Plus system will result in increased confidence in collectors, dealers and investors. Secure Plus will also help improve the accuracy of data such as population reports and condition census by eliminating frivolous duplication. A final important benefit of the Secure component is the retention of that coinprint which will certainly aid in the recovery of a Secure Plus coin should it ever be lost or stolen.
     Let’s move on to the Plus component. When I first joined PCGS, I had dozens of people suggest that we add a “PQ” designation to our grades for high-end coins. David had received many similar requests over the years. As we discussed the idea, it became clear that there were shortcomings with the PQ designation. PQ usually is associated with eye appeal. However, a coin may have great eye appeal, but beneath the gorgeous toning, contact marks, scratches or other defects could be hidden. We wanted something more comprehensive that addressed all the components of grading – wear, strike, luster, contact marks and eye appeal. This is how the Plus came about. Early in the process, we decided that grading in whole grades – 64, 65, 66 – didn’t give us enough information about a coin to decide if it was a Plus coin or not. Many dealers already employ their own system of Plus grading such as grading coins A, B or C within a grade, or actually using decimals to indicate the quality of the coin. We decided to begin grading coins on a 700 point scale which then gave us ten grades within each whole grade. From there we decided that in order for a coin to receive the Plus (+) grade it had to grade in the top three grades within the whole grade. In other words, a 657, 658 and 659 would grade 65+. For those who used the A, B, C system, these would be the A coins.
     If a coin does not receive a (+) grade, that does not mean it’s a bad coin. There is nothing wrong with a 65.6, a 65.5, etc. There are many fine coins that are solid for the grade that are not quite a (+). It is very difficult to receive a (+) designation with perhaps 10-20% of coins within a grade worthy of that distinction. For a coin to receive a (+) designation, there can be nothing wrong with it. In other words, all the components comprising its technical grade must be superior for that grade. Coins cannot receive the (+) designation if, for that grade, they do not have positive or better eye appeal, minimal contact marks, strong luster and a strong strike. When you carefully examine a coin and conclude that it is a candidate for the next grade up, it is also probably a candidate for a (+) grade. As a matter of fact, coins that have been referred to as “liners” over the years are by definition (+) coin candidates.
     As I have already said, we try very hard to give every coin the proper – which means highest – grade. We’ve heard some concerns that coins wouldn’t get a higher grade because our graders would settle for just giving a (+) on a lower grade. We have also heard from some that they picked out their best coins and, for example, only 3 out of 20 received a (+) grade. They think we are being too demanding and question our standards. Both are legitimate concerns that we are very sensitive to. We are committed to this new level of precision and are focused on making it work. That is why we implemented the 700 point grading scale months ago. Since launching the Secure Plus program 60 days ago, we have produced over 10,000 Secure Plus coins with a significant number awarded the Plus (+) grade. Already, several coins have been detected as being altered.
     Our initial launch of Secure Plus was truly “The Big One,” yet we have just begun. PCGS is busily devoting additional resources to expanding Secure Plus and taking it to the next level. Much more is to come. We have thrown down the gauntlet to all the coin doctors out there with our first step. Next, we will be announcing additional features of Secure Plus as well as other initiatives in the weeks and months ahead. We are doing this because we believe it is the right thing to do. We believe PCGS Secure Plus will greatly improve the coin market and make it easier for you and others to enjoy this great hobby!

Reprinted from the June 11, 2010 issue #6 of the CDN Monthly Supplement
This article is copyrighted and may not be reproduced without express permission from CDN publications. ©2010 CDN Inc.