In 1973, the government gave away a handful of aluminum pennies now worth an estimated $250,000.
It wants them back.
This has put the government at odds with two California men were planning to auction off one of the pennies. Now, they are asking a judge to decide to whom the penny belongs.
Here’s the background:
When the price of copper rose in the mid-1970s, the government thought it might save a buck by making pennies from aluminum. The government gave a handful of the aluminum pennies to lawmakers — Joe Biden, then a senator, was one of the lucky recipients — to persuade Congress to ditch the old copper penny, which had become costly to mint.
Congress didn’t bite. Most of the leftover pennies at the U.S. Mint in Philadelphia were melted down, and some of the gifted ones were returned. But it’s not clear how many aluminum pennies are still in pockets and piggy banks.
One coin, found by a U.S. Capitol Police officer when it fell from a congressman’s pocket in 1974, didn’t turn up again until 2005.
And at the Mint, coins can get lost as easily as they do in a sofa.
It was likely that some of these, by accident or on purpose, would enter circulation.
One of them ended up in the hands of a Randall Lawrence, whose father worked at the Denver Mint in 1973, when the coins were made.
The government has no record that 1974-D aluminum cents, as the coins are called, were made at the Denver Mint, but there are rumors to the contrary.
Lawrence sold his coin to Michael McConnell, owner of the La Jolla Coin Shop, who later recognized its value and contacted Lawrence. The two agreed to sell the coin at a public auction in April and donate part of the money to charity, the U-T San Diego reported, but the federal government demanded they hand it over.
The letter, from a Treasury Department lawyer, says the government owns the penny because it was never issued as legal tender, meaning it was never valid as money. Now the men are asking a federal judge to declare the government’s claim to the coin invalid so they can sell it.
If the judge sides with the government, it would be bad news for coin collectors. Such a ruling would put “a cloud over all non-legal-tender coins because it would permit future seizures without warning or further justification,” according to Lawrence and McConnell’s complaint.
“No one really is surprised these days when the government tries to overreach,” attorney Armen Vartian, who represents the two men, told the U-T San Diego. “You just don’t think it’s going to happen to you.”
The government allows people to collect and sell other coins never issued as legal tender, such as the 1913 Liberty Head nickel. One exception: $20 gold pieces minted in 1933. The government successfully reclaimed those because they proved the coins had been stolen from the Mint. However, courts rejected the government’s claim that the coins had to be returned because they were not issued as legal tender, which could be good news for Lawrence and McConnell.