NMI out of legal battle on ‘fraudulent’ coins

The CNMI government is out of the legal issues surrounding the sale of alleged fraudulent CNMI coins in the U.S. mainland, Gov. Juan N. Babauta said yesterday.

He said the matter is between the company selling it and the New York Attorney General.

“When it comes to legality, it’s up to them. It’s their legal issue. They have to take care of that,” he said.

Babauta also said that the company, SoftSky, which he had authorized to mint commemorative coins bearing the name or representation of the Commonwealth, will be remitting an additional $110,000 to the CNMI royalty fee by the end of this month.

“This is on top of the $50,000 that they have issued,” he said.

The Executive Branch earlier received two $25,000 checks from Softsky from the proceeds of the sale of minted CNMI coins.

This developed as a New York court recently allowed Attorney General Eliot Spitzer to temporarily suspend the sale of commemorative Sept. 11 coins advertised as being minted from silver recovered at the ruins of the twin towers.

Spitzer said the National Collector’s Mint, based in Port Chester, N.Y. falsely claims that the coins are legally authorized silver coins.

The coins, produced by SoftSky Inc., are advertised as nearly pure silver “when they’re only silver-plated.”

He said “the collectible was actually produced by another company under a licensing agreement with the CNMI.”

The CNMI government has maintained that it has no authority to mint legal tender coins.

In a recent news release, the U.S. Mint said advertisements for the Freedom Tower product appear confusing because the company uses phrases such as “legally authorized government issue,” “U.S. territorial minting,” and “silver dollar.” The product itself also may be confusing because it bears the inscription, “In God We Trust,” which Congress requires on all United States coins, and the inscription, “One Dollar.”

The U.S. Mint stressed that Congress has the exclusive power to coin money. It said Congress has delegated its authority to mint and issue coins to the Secretary of Treasury, and that Congress requires the Secretary to carry out these duties at the U.S. Mint.

The CNMI has been earning royalties from its agreement with SoftSky, which had already remitted royalties to the CNMI from proceeds in the manufacture and sale of commemorative coins using the name of the Commonwealth.