Joel,

Good to see your caps button is off. Har har just kidding!
Re: conflict of interest. I can't 'lose' this one simply because it's fact. It's not me making this up, it's a basic tenet of the industry. Here is an excerpt from the Code of Ethics from the International Society of Appraisers:

"A dealer / appraiser should not make an appraisal of an item of personal property that the dealer/appraiser will buy, or that the dealer / appraiser owns and intends to sell."


Why Joel? Because if the dealer/appraiser intends on buying it, then he might issue an authentication which intentionally lowers the value of the item so he can buy it for cheaper. Example: Joel Alpert finds an '89 Bo Jackson jersey in his attic and doesn't know what it is. The truth is it's a game-worn jersey. Joel comes to me with this jersey. I'm both an authenticator and dealer. Joel is going to rely on my authentication. Recognizing that it's a $1000 Bo Jackson that, as a dealer I could easily re-sell, I say "Ok I'll buy it and I'll authenticate it. Let's see, my 'authentication' says it's just a replica, I'll give you $150". I intentionally issued a false authentication because I had a personal financial stake. Had I only been an authenticator who was paid regardless of the outcome of the authentication, I would have no incentive whatsoever to lie.
Secondly Joel, if I intend to sell an item, how do you possibly think my authentication will turn out? Here's a hint: It's legit. I don't even need to see it. If I'm going to make money selling it, then my authentication will magically make it legit. You can't see this?


Here is Dave Grob commenting on MEARS' policy to avoid this blatant conflict of interest:

"A [MEARS employee] may sell an item in a private transaction as an individual, but that item can not be submitted for a MEARS evaluation as part of that transaction. They will have to provide an independent letter of their own, just like any other dealer in the industry who buys and sells....In addition, we do not charge an auction house for the work done on those consigned items as it would be a conflict of interest for a MEARS member to profit both from the work and the submission at the expense of the auction house."

PSA/DNA's CEO Michael Hayes: "We consider it a conflict of interest for a seller to be the authenticator because this places the seller in a position of bias. Our employee-authenticators do not buy or sell and our company does not buy or sell...."


"They authenticate an item, find it valid and sell it - What are they doing wrong?"

Here's why it's a conflict: If you're going to sell an item, then there is a likelihood that this possibility of profit will cause you to authenticate an item in your favor. Furthermore Joel, if you're going to buy an item in order to re-sell and you're going to base the value of that item on your own "authentication" then again there is the "great likelihood" that you're intentionally going to issue a false authentication in order to buy it at a lower price for yourself. Want more? If you run a business, then the more more "authentic" items you have, the more you can sell and the more money you can make. Selling 150 "authentic" jerseys will bring you far more profit than selling 5. Well if the person who decides if these jerseys are authentic is the same damn person profiting from their sale, then how do you think the authentications will likely turn out? Surprise, they're all authentic! What a shock.

Joel, do you think it's a conflict of interest for a doctor to also be paid by a drug company? When that drug company comes out with a new medication, do you think that doctor will issue positive recommendations about it if he's being paid by the drug company? People depend on doctors for unbiased, honest advice, just like they do from authenticators. When the "salesman" is also the "authenticator", a bias automatically and immediately occurs and puts into question the objectivity and impartialness of the authenticator.

Rudy.