Saturday, December 16, 2006

 

Money

Mint rules rolling in to combat coin cheats

Given rising metal prices, many US coins in a person's pocket are worth more melted down than their face value. That has the government worried.
US Mint officials said Wednesday they were putting rules into place that will prohibit the melting down of 1 US cent and 5 US cent coins.
The rules also limit the number of coins that can be shipped out of the United States.
"We are taking this action because the nation needs its coinage for commerce. We don't want to see our pennies and nickels melted down so a few individuals can take advantage of the American taxpayer," Mint Director Edmund Moy said.
Officials said they have received a number of inquiries from the public in recent months concerning the value of the metal in the coins and whether they can be melted legally.
The new regulations prohibit the melting of 1 cent and 5 cent coins, with a penalty of up to five years in prison and a fine of up to US$10,000 (HK$78,000) for people convicted of violating the rule.
The rules also require that shipments of the coins out of the country be for legitimate coinage and numismatic purposes.
No more than US$100 worth of the coins can be shipped at one time.
Because of the prevailing prices of copper, zinc and nickel, the cost of producing pennies and nickels exceeds the face value of the coins.
A nickel is 25 percent nickel and 75 percent copper. The metal in one coin costs 6.99 cents for each 5 cent coin.
When the Mint's cost of producing the coins is added, the total cost for each nickel is 8.34 cents.
Modern pennies have 2.5 percent copper content with zinc making up the rest of the coin.
The current copper and zinc in a penny are worth 1.12 cents. The cost of production drives up the cost of each penny to 1.73 cents.
Pennies made before 1982, which are still in circulation, would be even more lucrative to melt down because they contain 95 percent copper and only 5 percent zinc. The metal value in those coins is 2.13 cents per coin, Mint officials said.
The new regulations are being published in the Federal Register. They will go into effect as interim rules and will not become final until the government has a chance to consider possible modifications based on public comments.

Quoted from
The Standard
15-Dec-06

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