View Full Version : NY Daily News- Forgeries take card companies for a ride

02-19-2006, 11:40 AM
This is related to the HBO Real Sports story and appeared in today's New York Daily News. Written by Michael O'Keeffe who often writes, about the game used hobby.

New York Daily News - http://www.nydailynews.com/02-19-2006/sports/baseball/v-pfriendly/story/392741p-333046c.html

A sign of the times
Saturday, February 18th, 2006

In hindsight, maybe it was simply too good to be true: An unemployed computer tech in Mississippi named Barry Scott appeared to hit the jackpot when he bought a pack of baseball cards in a hobby shop last fall. The pack included an "autograph card" from Upper Deck's Legendary Cuts series, a one-of-a-kind item that came with the autographs of four of the five members of Cooperstown's 1936 inaugural class inserted in it - Babe Ruth, Walter Johnson, Ty Cobb and Honus Wagner (the fifth was Christy Mathewson).

Scott was soon contacted by Beckett Media, the hobby giant that grades cards and publishes memorabilia magazines and price guides. Company officials rolled out a public relations campaign to drum up press for Scott and his score - as well as some positive publicity for Beckett and the hobby - and arranged for the card to be sold on eBay.

The high bidder was a Milwaukee airport administrator named Kevin Demitros, a longtime collector who paid $85,000 for the card.

"This is my Holy Grail," Demitros excitedly told the Daily News just before Christmas. "This might be the finest card I will ever own. This is very exciting."

The thrill was gone by mid-January. Demitros received a phone call last month from Joe Fallon, Upper Deck's director of product development, who told him the Ruth and Johnson autographs may be forgeries. HBO's "Real Sports," Demitros says Fallon told him, was going to air a segment that night on sports memorabilia that would raise significant doubts about the authenticity of the two signatures. "He promised me they'll make good on the card," Demitros says.

But instead of making good, Demitros says the company ignored his phone calls and E-mails for weeks until he finally hired an attorney and threatened to take legal action.

Johnson's signature was an especially obvious counterfeit, memorabilia experts say.

"They weren't even trying," laughs Hank Thomas, a collectibles dealer who is also Johnson's grandson and biographer. "It's horrible. I have seen more Walter Johnson signatures than anybody, and I have to tell you, it's laughable."

Sports collectibles insiders say Demitros' card symbolizes so many of the problems that plague their industry: too many forgeries, too many unqualified authenticators, out-of-control prices that scare off casual collectors, and an Internet marketplace that resembles the Wild, Wild West.

Internet auctions like eBay are flooded with counterfeit autographs, they say, especially those of big names like Ruth. Good authenticators, meanwhile, are few and far between - "Real Sports" sent memorabilia with bogus autographs to six authenticators, and just two (Richard Simon Sports and Global Authentication Inc.) correctly identified the bad merchandise. Card prices, meanwhile, look like the tech stock boom of the 1990s, driven more by hype and speculation than real value. And the Internet has become a badlands for the traffickers of fake goods, a place where they can hit-and-run with a network of anonymous E-mail addresses and Web sites.

Several autograph experts and card dealers told the Daily News they don't believe Upper Deck deliberately passed on forgeries; UD, like many other victims of collectibles scams, was duped. The controversy has prompted Upper Deck to change the way it does business, spokesman Don Williams says - the company will soon begin work with a highly regarded authenticator, a person he wouldn't identify who will provide third-party endorsement of future signatures. He insists, however, that Upper Deck works with reputable vendors and takes painstaking steps to insure it provides authentic signatures.

Williams won't say, however, where Upper Deck obtained the questionable signatures or if a third-party authenticator had reviewed the autographs under question. Doubts, meanwhile, have been raised about other Legendary Cuts cards. Richard Simon, the New York autograph dealer who passed HBO's test, suspects three single autograph Legendary Cut cards are bogus: a Ruth, a Lou Gehrig and what appears to be "Caminna Mack."

Demitros waits impatiently as his attorney and Upper Deck's lawyers attempt to work out a deal. He says he wants his money back, not a replacement card. "There is such a shroud of doubt surrounding his card," he says. "Its value has really been damaged."

* * *

Upper Deck is the Cadillac of card companies, the hobby's top o' the heap. It was founded in a Southern California card shop in the late 1980s and quickly distinguished itself by using state of the art printing and holograms that deterred ripoffs and counterfeiters.

The Carlsbad, Calif.-based company is now one of the best-known names in the sports-industrial complex, a global corporate giant that sells autographed memorabilia as well as sports and entertainment cards. It not only makes baseball, football, basketball and hockey cards for North America, it also makes cards for Manchester United and Chinese soccer clubs.

But Upper Deck's success and its reputation for quality have not shielded it from controversy. Journalist Pete Williams' book "Card Sharks" says Upper Deck secretly reprinted runs of valuable cards in the early '90s, then distributed them to its top executives, who would sell them for huge profits, a highly unethical practice.

Cards like Upper Deck's Legendary Cuts are the latest marketing twist by an industry that now charges as much as $500 for a pack of cards. A few years ago, game-used memorabilia cards that included a big leaguer's bat splinters or uniform threads were big sellers.

Now the hot ticket is autograph cards: The card companies buy deceased Hall of Famers' letters or cancelled checks, cut out their signatures and mount them between laminated layers.

Some collectors and dealers dismiss the signature cuts as a testament to hype and marketing; the cards themselves are worth far more than the autographs they encase. The four autographs on the card Demitros purchased, for example, would cost less than $10,000 total if purchased separately.

"I was shocked to see cut cards commanding such prices," Thomas says. "This is an artificial rarity. Upper Deck can say it is one of one because Upper Deck chose to make just one."

Demitros says he knows he paid a premium for the card, but he thought it was worth it, since the card had been endorsed by both Upper Deck and Beckett. He also figured the card would appreciate. "I used to joke this card was my retirement fund," he says.

Beckett Media graded the card a "nine" and gave the autographs a grade of "10," but Beckett spokesman Elon Warner says those grades are based on the card's appearance; no autograph expert looked at the signatures on Beckett's behalf, and the company presumed if Upper Deck had signed off on the autograph, it was good. Beckett's primary role, he adds, was as an agent for the sale (the Beckett Store, a Beckett Media division, was listed by eBay as the seller).

"Barry was hesitant to sell this by himself," Warner says. "He asked us to help him sell it."

The card companies' buying spree for autographs to place on the cards has jacked up the price of historically significant autographs - prices for a Bambino signature, for example, have tripled in recent years, from $2,000 to $6,000. Many dealers are capitalizing on the boom and selling previously private collections. Escalating prices also brought out the crooks and the cretins, and the market has been flooded with counterfeits.

"There are a lot of forgeries out there," says Tim Fitzsimmons, the FBI agent in charge of Operation Bullpen, the bureau's ongoing crackdown on bogus collectibles. "A high percentage of the autographs of athletes whose signatures sell for a lot of money are forgeries."

One autograph expert who spoke to the Daily News on condition of anonymity says Upper Deck, squeezed by the autograph price boom it helped create, may have purchased the questionable autographs from a dealer who offered lower prices. Upper Deck, he says, might just be the latest victim who failed to heed what should be the hobby's First Commandment: If the price is too good to be true, it probably means the item is a fake.

For its part, eBay spokesman Dean Jutilla says the company has taken steps to protect consumers. Its "Quick Opinion" service allows prospective buyers to have experts analyze the autograph before they buy it, he says.

But California sports collectibles dealer Shelly Jaffe says it's still not hard to find forged autographs on eBay. After inspecting Mickey Mantle-autographed-items on eBay with the Daily News recently, Jaffe said more than half appeared to be counterfeit.

"Upper Deck did not do its due diligence on this card," Jaffe says. "You gotta go out and get more than one opinion. This is the No. 1 card company in the world, but the story behind this card is sloppiness."

Jaffe may know more about forgeries and counterfeits than anybody else in the collectibles industry. He was one of the people Fitzsimmons arrested during Operation Bullpen.

Jaffe, a key source for the HBO program, spotted Demitros' card on eBay while "Real Sports" was putting together its report (Jaffe, hidden in shadows during on-air interviews, was identified as "Eddie" on "Real Sports", but he has allowed the Daily News to use his name). Jaffe says he told the show's producers he suspected the Ruth and Johnson signatures came from a master forger who had provided him with thousands of bogus signatures in the 1990s.

"Walter Johnson was one of the autographs (the forger) did poorly," Jaffe says.

"Real Sports" producers questioned Upper Deck about Jaffe's allegations, and the card company contacted Demitros to let him know about the shoe that was about to drop. Upper Deck originally vowed to make things right for Demitros, but executives then stopped responding to his E-mails and phone calls. Upper Deck's Williams says the company wants Demitros to send it the card, so it can determine for itself if the autographs are forged.

"This is something we can't determine based on computer scans," Williams says.

Williams ripped "Real Sports" for relying on Jaffe as a source, blasting him as unreliable because of his criminal record (Jaffe spent six months in prison and was fined $250,000 for his role in the scam). Jaffe says he advises the media and law enforcement on forged signatures as penance for his past crimes. Fitzsimmons says Jaffe has cooperated with the government since his arrest six years ago.

Demitros, meanwhile, waits as his attorney and Upper Deck's lawyers continue their negotiations.

"I can not stress enough how disappointed I am with Upper Deck," he says. "They have been totally unprofessional throughout this whole thing."

02-19-2006, 11:54 AM
What surprises me most is the way UpperDeck is handling this embarrassing situation. Why not do the right thing and admit its mistake(s). Maybe they are afraid of all the other cut signature cards out there and the liability that goes with rectifying the problem. Well, Richard Simon and Global are to be commended for spotting the items in question.

02-19-2006, 12:13 PM
"Escalating prices also brought out the crooks and the cretins . . .."

That . . . is classic.

02-19-2006, 03:35 PM
Figures...card companies treasure the fake stuff and chop up the real stuff. My heart bleeds for poor 'ol Upper Deck.

02-19-2006, 07:24 PM
I guess Upper Deck decided to promise to make good on the card, but then they decided not to pay the $85,000.00 the guy paid for the card back to him.

What, are they going to try to buy authenticated real autographed cuts and reproduce the card? I'm sure the buyer will really like that - Not.

02-19-2006, 08:40 PM
PR 101--make it right for the customer you screwed over (and the whole world knows about it!) or the bad karma will come back to bite you sooner than later!