- Joe Presti
- Spring of 2021
Do You Have an Extra $10-20 Million?
Recently, on June 8th, Sotheby’s auctioned off three legendary classic collectables. The items that were auctioned are the fabled British Guiana one cent Magenta stamp ($8,307,000), the only know example, a plate block of Inverted Jenny stamps ($4,860,000) and the only available and legal to own 1933 $20 Double Eagle ($18,872,250).
The history of the 1933 $20 Double Eagle is fascinating. FDR was elected in November 1932 and inaugurated on March 4th, 1933. Two days later on March 6th, he wasted no time and invoked a bank holiday and basically took the United States off of the gold standard. On March 9th, Congress made it official and passed a bill requiring the return of gold coins, with an exception for coins with “special value.” Don’t you wish government could work that quickly now?
On March 2nd, the mint began striking 1933 $20 gold coins. For some unexplainable reason between March 15th and May 19th the coiner of the mint officially turned over to the cashier of the mint the new $20 gold coins. Why they did this after the country had been taken off of the gold standard will always be a mystery. In August of 1934 the Mint Director ordered all gold coins remaining in the treasury vaults melted.
The first recorded appearance of a 1933 $20 Double Eagle showed up in a Stacks sale in 1944. The potential sale sparked an investigation by the Secret Service and led to the confiscation of multiple examples across the country, and it all pointed to a Philadelphia jeweler name Israel Switt. When questioned by the Secret Service, Switt claimed to have purchased the 1933 $20 Double Eagle from various collections. But these statements, as well as others, were proven to be lies more than 60 years later.
Not trusting Switt’s explanation where he got the coins, the agents turned their attention to a former cashier at the Mint who was imprisoned for stealing silver coins and was also a suspect in the disappearance of a bag of 1928 $20 gold pieces. Matching up financial records of Switt and the cashier, they noticed withdrawals and deposits that matched and were within the same time period. The deposits totaled $10,000 over six months, which was an enormous sum in 1933 and was equal to more than three times the cashier’s annual salary.
The scheme worked like this. The cashier was the only person at the mint who had physical access to the 1933 $20 gold pieces. Mr. Switt would come to the cashier’s window, place his order and pay face value for the coins. Switt would simply walk out of the office with the 1933 $20 Double Eagle in his pocket. Later he would send a much larger payoff to the cashier. In total 10, 1933 $20 gold pieces were recovered as stolen property, case closed, or so we thought.
In 1944, a 1933 $20 Double Eagle was sold to King Farouk of Egypt, who was a collector of anything and everything. Farouk applied for an export license to ship the coin to Egypt. Unaware that the coin was never legally issued, the license was granted and it sat in Farouk’s collection until he was overthrown and his collections liquidated. Under pressure from the United States, the coin was withdrawn from the auction, but never returned to the U.S.
In 1994, a jeweler from Cairo began selling very high-quality rare coins to dealers in London. It was confirmed that the coins did come from the Farouk collection through intermediaries of the government that overthrew Farouk. One of the coins was the 1933 $20 Double Eagle, and over the next two years a buyer who turned informant agreed to buy the coin, but the transaction had to take place in the U.S. In 1996 a meeting was arranged and the Secret Service confiscated the coin and arrested the coin dealers involved.
After a five-year legal battle between the government and the London coin dealer, a settlement was achieved. Because the U.S. had issued an export license, both parties agreed that the coin would be turned over to the government, “legalized” and sold, with the proceeds split evenly. In 2002, Sotheby’s sold the coin to an anonymous buyer for $7.6 million. After the sale, the auctioneer took a $20 bill out of his pocket and gave it to the Mint Director to “monetize” the coin.
In the ensuing 20 years, no one in the numismatic community knew who bought the coin until the owner stepped forward. Stuart Weitzman, a shoe designer turned out to be the owner of not only the 1933 $20 Double Eagle, but the above-mentioned stamp rarities, and has decided to liquidate his holdings to benefit charity.