Coin Super Story: The Great Gold Scam (or how 5˘ became $5)

The Liberty Head “V” Nickel has a story of swindle unlike any scheme in the entire history of United States of America coinage. Josh Tatum, who happened to be a deaf individual, saw an opportunity and grasped it.

In 1883, the U.S. Mint issued a new nickel, referred to as the Liberty nickel.  Tatum noticed that there was no denomination on the back. That is, it did not say "Five Cents" or "Nickel".  It did have a "V" (the Roman numeral for "5") that the U.S. Mint deemed adequate for its newest coin.  As it turned out, it was far from adequate.

Tatum not only noticed the lack of denomination, but also that the new coin was the size and shape of the already circulating $5.00 gold coin, and that it had a similar "Liberty" on the front.  So Josh, being the enterprising man invested $50 (1,000 nickels) in the new “V” Nickels.  He then had a jeweler friend of his gold plate all 1,000 of the “V” Nickels, making them look very much more like the $5.00 gold piece.

Armed with a newly gold-plated nickel, Mr. Tatum would walk onto a tobacco store, place one of his coins on the counter and point at a five cent cigar. The unsuspecting clerk would give Tatum the indicated cigar and $4.95 in change.

Knowing a good deal when he saw one, Tatum next invested in 4,000 more “V” nickels. That additional investment of $200 undoubtedly came from the profits of his scam.  This idea took our Mr. Tatum from his home in Boston all the way to New York City.  Later that year Mr. Tatum was arrested.

His case was dismissed on the grounds that he had never misrepresented anything.  Mr. Tatum never said a word, except to say “Thank you.”  The merchant’s mistake meant they had in fact cheated themselves.

In late 1883, when the Nickel was re-struck, the word “Cents” was added to avoid any further attempts of deception.