Mid-Century Sovereign Coin Combatted Counterfeiting

Posted on 10/13/2020

Forty years after they were taken out of circulation, Sovereign gold coins returned to market.

During World War I, gold coins stopped circulating within Great Britain. The Sovereign had been their standard gold coinage unit valued at one pound (or twenty shillings), but these coins were last made for currency use in Britain in 1917. By the late 1930s, the gold Sovereign was produced only ceremonially and included in proof sets commemorating the coronation of a new monarch.

The Sovereign came back to life in the late 1950s. From 1957 to 1968, Great Britain produced over 45 million Sovereign gold coins. But they weren’t made for use in Britain. Instead, they were issued to combat a scourge of counterfeit coins flooding foreign markets.

This history is well described in “Sovereign Fakes,” an article in the July 2004 Numismatist by Robert Matthews, retired Assay Master for the British Royal Mint. After the Sovereign ceased to be used in Britain, it continued to circulate in Greece and the Middle East, Matthews explained. Of all the gold coins used in these markets, Sovereigns were the most preferred unit and they traded at a significant premium to their metal content.

Since Sovereigns were no longer being produced but there was strong market demand for obsolete issues, counterfeiters stepped in to fill the void. Clandestine mints in Syria, Italy and Switzerland produced fake Sovereigns of varying quality, all of which had different prices in local markets.

British officials became aware 5% or more of the Sovereigns in these foreign markets were fake and moved to close counterfeiters’ operations. When counterfeiters in Switzerland and Italy were caught, British authorities were surprised to face an unexpected challenge. The foreign courts weren’t receptive to Britain’s claims. They reasoned that if the Sovereign was no longer being produced by the British and no longer used by them for their commerce, what laws were violated by copying them?

While authorities in Great Britain continued their legal challenge, they realized that producing a new Sovereign coin would strengthen their claims in court. Further, if they released a new Sovereign coin in sufficient quantity, they would increase supply enough to suppress the premium, thereby lessening the incentive for counterfeiters.

1966 Great Britain Sovereign
Click images to enlarge.

Thus, starting in 1957, they churned out a new Sovereign coin that remained in production for the next 11 years. It shows Queen Elizabeth II with a laurel headdress. The portrait is slightly modified from her rare 1953 coronation-year Proof Sovereign, and thus this design is referred to as the “second laureate bust.” The reverse features Benedetto Pistrucci’s long-running St. George slaying the dragon design. No coins were struck in 1960 and 1961. The high mintage figure for this series was 8.7 million pieces in 1958, and the low was just under 1.4 million in 1959.

Britain’s plan worked. The large, well-timed issue succeeded in limiting the role of counterfeit coins in foreign markets. As a boon to collectors, these mintages are large enough that all issues are readily available today. That doesn’t mean finding nice examples is easy.

This new Sovereign had been made as a circulating bullion coin, and no special care was taken during transport and handling. The coins got knocked up. As the obverse design is relatively shallow in relief, the bust of Elizabeth II is easily abraded. The typical grade of pieces encountered is MS 63, with coins becoming appreciably scarcer at the Gem MS 65 level. Most dates have very low NGC-certified populations in MS 66, and only two MS 67s have been graded for the entire series, both from the 1959 issue, the most common date in high grade. The 1962 is the lowest population date in MS 65, with just five pieces and none finer. Like earlier Sovereigns, coins of this issue are 0.917 fine gold. They are alloyed with copper only, lending them a rich orange color. All dates exhibit a satiny luster, and occasionally attractive specimens are found with a bluish patina.

For collectors, the set is a fun, accessible pursuit. Because these gold coins were made for commerce, albeit outside their country of origin, they sit squarely in the tradition of earlier Sovereign issues as a true currency issue. They have interesting historical roots, born during the mid-20th Century transition away from the gold standard and a massive expansion of global commerce.

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