Brass Core Chips

What is a brass core chip?

These are chips that have a plastic injection molded over a metal core. The single piece metal core may include a casino's name, location, denomination and edge insets. The plastic is molded around the metal, allowing the metal to show on the surface. These should not be confused with metal center chips manufactured by Bud Jones Co. In Nevada, brass core chips have been issued by Harrah’s (Lake Tahoe), Crystal Bay Club (Lake Tahoe), Harvey’s (Lake Tahoe), Hyatt Regency (Lake Tahoe), Reno Ramada (Reno), Ranch House (Wells), Silver Smith (Wendover) and other casinos.

What is the controversy over brass core chips?

During 2001, the CC&GTCC became aware of the production and existence of counterfeit brass core chips. Details on these chips and the investigation are presented below.

Counterfeit Brass Core Chips, Information You Need To Know
Brass Core Investigation Interim Report - May 3, 2002
Brass Core Matter - Porter Complaint Against Gonski
Brass Core Matter - Porter Complaint Against Akeman

Counterfeit Brass Core Chips, Information You Need To Know

By Nate Pincus

During 2001, members of the Board of the CC&GTCC were made aware of the production and existence of counterfeit brass core chips. The Board undertook an investigation. Jim Reilly, our Club Claims Director spent several months talking to members and gathering information. I urge you to read my President’s Letter in this issue for more about this matter.

I want to answer some of what I expect will be frequently asked questions.

What is a brass core chip?

What specific chips have been counterfeited?

There is creditable evidence that the following chips have been counterfeited:

Unfortunately, there may be other chips as well.

Casino	Denomination	Chip Color
Crystal Bay Club	$5	Orange
Crystal Bay Club	$100	Brown
Harrah's	$1	Red/White/Blue
Harrah's	$2.50	Pink
Hyatt Regency	$2.50	Green
Ranch House	$.50	Various
Ranch House	$1	White
Reno Ramada	$100	White
Silver Smith	$1	Red/White/Blue

Note

Some of these chips, in the colors noted, are not listed in the Nevada chip guides. These are NOT new finds - they are counterfeits.
Chips from the Crystal Bay Club were re-made to eliminate the hole in the plastic.
Chips from the Ranch House were apparently re-made because they were fire damaged.

How are these chips counterfeited?

Apparently it is not a very difficult process to mold plastic around a brass core. In some cases, the existing plastic was removed from the brass core, melted down and re-molded to the core, eliminating a hole or other damage. In other instances, new plastic was used. Brass cores, like other collectibles in our hobby exist in collections and may be available from those involved in the legitimate production of brass core chips. While there is only one confirmed person who produced counterfeit chips, there may be others.

How can I tell a real chip from a counterfeit?

While it is difficult to discern, I have been told there a couple of ways to differentiate.

The edges, including the metal on a counterfeit are very smooth, with no machine marks. The counterfeits that we are aware of are made by hand and various grades of sandpaper are used to remove excess plastic, thereby smoothing both the plastic and the metal. Also, the chips will not have the injection marks normally noticeable on newly manufactured brass core chips.

Are all brass core chips suspect?

No. There are still a vast number of brass core chips that were manufactured by legitimate companies and used in casinos. To the best of our knowledge, chips acquired more than two years ago are not suspect. Only those chips listed above are reasonable to suspect at this time, but all chips should be physically examined and their background should be probed.

Keep in mind that there are legitimate chips of the identical denominations and colors from the same casinos as the counterfeits. These genuine chips should not be devalued due to the existence of counterfeits. Be wary of odd colored chips and chips in unused condition.

It is also important to know whom you are dealing with so that you have recourse. Make a record of any chips that you buy and ask for a receipt, and, of course, buy from a CC&GTCC member who ascribes to our Code of Ethics.

What can I do if I think I have a counterfeit chip?

You should immediately contact the person from whom you obtained the chip. You should seek 100% satisfaction from this person as called for in our Code of Ethics. If you are not satisfied, you may file a claim with the Club’s Claims Director. You should also contact me with any information that might help in the investigation. This matter remains open and any additional information will be turned over to the proper authorities. The sale of counterfeit chips may constitute fraud and the production of counterfeits may violate the Hobby Protection Act.

Brass Core Investigation Interim Report

May 3, 2002

Overview

During the 2001 Convention, based upon a conversation with a club member, the Board initiated an inquiry into the possibility of a misrepresented brass core chip sale. That is to say, chips sold as original in nature that were in fact non-genuine.

This interim report will deal with the investigation of a complaint subsequently received from Dean Porter (R-2123) concerning Mel Jung (R-291) and sales made by him. Porter alleges that Jung sold him certain brass core chips that Jung knew were non-genuine without disclosing this fact to Mr. Porter.

Jim Reilly (the then CC&GTCC Claims Director) undertook this investigation directly after our 2001 Convention in June, 2001. Reilly's report was sent to the Board of the CC&GTCC in early February, 2002. The Board, with Secretary Marty Kaplan taking the lead, followed up with some of the principals in the investigation, as was suggested in Jim Reilly’s report.

This brass core investigation will continue and it is hoped that more members with information will step up and share that information so that the investigation may proceed. This investigation is not to be considered "closed".

For the purposes of this interim report, all original references in this document will use the word non-genuine (short for non-genuine in origin) when referring to chips that may be altered, forged, reproduced, counterfeit, modified, repaired, etc. In this interim report you also will find that those interviewed have, on occasion, referred to the non-genuine chips in other terms. Where these individuals have been quoted their reference to the non-genuine chips has not been changed.

We are using the word non-genuine because the various chips being referred to fall into several different categories. Some may be counterfeit, some altered, some repaired, some forged, and in some cases this is not readily discernable.

Quoted material from other documents will be presented in an indented fashion for clarity.

Where the names of dealers, collectors or members who are not relevant to the conclusions drawn in this particular interim report appear, those names have been replaced with non-descript references. In subsequent reports those references will be removed and the correct names inserted based upon the circumstances of that particular interim report.

Discussion of the Facts

Introduction

Dean Porter has made a complaint that Mel Jung sold him certain brass core chips that were non-genuine and did not disclose that information. The chips that Porter alleges are non-genuine are:

Chip Description	Color	Purchased
$2.50 Harrah’s	Pink	2000
$5.00 Ranch House	White	2000
$5.00 Ranch House	Black	2001
$100.00 Silver Smith	Yellow	1995
$1.00 Silver Smith	Blue	1995

While Porter claims that Jung sold him five (5) non-genuine brass core chips without disclosure, this report will focus on the transaction of the pink $2.50 Harrah’s chip. It should be noted that this non-genuine chip was produced by David Whalen and acquired by Mel Jung from Whalen. The details of that transaction are presented in context later in this interim report.

Both Jung and Porter agree that the pink $2.50 Harrah’s chip is non-genuine and that Jung sold the chip to Porter. Jung and Porter disagree about the disclosure at the time of the sale. Jung and David Whalen both agree that Jung acquired the "sale" chip from Whalen. But Jung and Whalen have very different versions of this transaction.

David Whalen has provided statements to both Jim Reilly and Marty Kaplan that he has produced non-genuine brass core chips for Mel Jung using brass cores and brass core chips supplied by Mel. He estimates that he received 30 to 35 cores/chips from Mel and completed and returned 20-22. He stated that he produced chips for Mel from the Ranch House, a pink $2.50 Harrah’s, and other chips as well as repaired non-denomination chips from the Hard Rock

Jim Reilly questioned Mel Jung regarding Whalen’s statements that chips were produced for Jung. Mel Jung denies that Whalen ever produced chips for him. Jung states that the only chip that he ever purchased from Whalen was the pink $2.50 Harrah’s.

Dean Porter states that he purchased the pink $2.50 Harrah’s chip from Jung without Jung’s disclosure that it was non-genuine. While Jung states that he did disclose that the chip was non-genuine, there is no disagreement that this is the pink $2.50 Harrah’s chip produced by Whalen.

Conclusions

David Whalen and Mel Jung disagreed completely about whether Whalen had ever produced non-genuine brass core chips for Mel Jung.

David Whalen was able to give in depth accounts of his dealings with Jung. He was able to give quantities and types of chips, details of his attempts to collect for his work, information about how he sent and received both cores and chips including time frames and association to events. While there are some details that conflict in Whalen's separate accounts, related on different occasions, his testimony is credible. While the production of non-genuine brass core chips has caused havoc within the hobby, Whalen has been forthright; admitting to producing these chips and giving detailed descriptions.

Jim Reilly spent many hours interviewing David Whalen in person, by telephone and by email and wrote this in his report:

There is, obviously, no doubt that David Whalen has produced a substantial number of "remanufactured" brass core chips, 80-90 by his own recollection. He is quite forthright about the practice and the process (in fact, is rather proud of his ability to repair and "remanufacture" these and other chips). He has been cooperative throughout this inquiry.

Several members other than Mel Jung identified David Whalen as the producer of "remanufactured" brass core chips (inasmuch as David admitted doing so, I deemed it unnecessary to identify the other members). None of them, not even Mel, whose comments were otherwise most critical of David's actions, claimed or even suggested that David had misrepresented the nature of his chips. The one chip which Mel agrees he obtained from David was, by Mel's account, represented as a "damaged pink" that had been "repaired".

I am not aware of any other information which would indicate that David has ever misrepresented the true nature of his "remanufactured" chips.

As indicated elsewhere in this report, David has cooperated fully in this claims inquiry. We met in person for several hours in July 2001 while I was in Las Vegas on a visit. We have spoken on the telephone a few times and he has responded fully to each of my email follow up inquiries.

There is a factual dispute between David and Mel Jung with respect to the question of whether David produced brass core chips for Mel, as well as with respect to the circumstances under which Mel came into possession of a "remanufactured" pink $2.50 Harrah's chip. Based on my personal observations, my lengthy discussions with David and reasons discussed more fully in Report 2002-01c, I have reached the conclusion that David was being truthful with respect to these matters.

Jim Reilly’s conclusion was that Whalen was truthful which in turn means that Mel Jung was not honest in his account of dealings with Whalen.

Dean Porter had no reason to lie about the lack of disclosure at the time he purchased the $2.50 pink Harrah’s chip. In fact, by coming forward he admittedly puts himself in jeopardy as he states in an email to Jim Reilly.

Jim Reilly summarized all their dealings as follows:

It is, however, not necessary to inspect the Harrah's chip, as there is no dispute that it in fact was produced by David. Essentially, this situation can be summarized as follows:

David says that he produced the chip at Mel's specific request, from another chip provided to him by Mel. Mel says that he had nothing to do with the production of the chip and purchased it from David for $200-400 "to get this aberration off the market".
Mel says he told Dean that the chip was "not an original chip" and that it had been "created" by a chip repairman, but he sold it for "$200-500". Dean says simply, "I got mine from Mel Jung as an original and paid over $500 for it."

The long and the short of it is, someone is lying. To believe Mel's version of these events, it is necessary to believe that both David and Dean are lying. It is with considerable regret that I have reached the conclusion that David and Dean are not lying.

With respect to the production of the chip, it is my belief that David Whalen was entirely forthcoming about his role in "remanufacturing" these chips. I spent several hours discussing this with him in person and inspected all of the chips which are still in his possession. He did still have the blank Reliable brass cores which he said were given to him by Mel. His statements about this situation, in my opinion, have "the ring of truth".

Furthermore, Mel's statement that he paid $200-400 for the chip for the purpose of getting "this aberration off the market" is not believable for two reasons. First, $200-400 is an extraordinary price to pay for a "fake" chip just to "get it off the market". Second, by Mel's own admission, he told Dean that he "had it in hand" and then sold it for $200-500. If he obtained the chip from David for the altruistic purpose of getting it off the market, why did he turn right around and tell an excellent customer that he had it (thereby putting it right back on the market) and selling it at a profit (it seems certain that Dean's recollection of the selling price -- $500 -- is correct). [In answer to another question, Mel told me that he has sold Dean 300-500 brass core chips over the past five years.]

This conclusion is reinforced by the disagreement between Mel and Dean as to the circumstances of the sale of the chip. Dean has nothing to gain (and a lot to lose) by making the accusation that Mel deceived him about the nature of the chip. Early on, before he identified any of the dealers who had sold him "remanufactured" chips, he said:

"All the brass core chips I bought with one exception were represented as the real deal. The main reason I'm hesitant is if the club doesn't go thru with this it leaves me out on the limb. Believe me the sellers are old timers who have been there a long time. ... I've mostly enjoyed my association with the club and hate to lose it."

It is clear that he is distressed by this situation (both he and another member who has asked for anonymity) have confirmed that they have discussed these chips at length, that Dean was reluctant to come forward and that he did so only after urging by the other member. The fact that he has not responded to my follow up inquiries indicates that he continues to have reservations about providing details regarding other chips and other dealers.

In combination, these circumstances compel the conclusion that Mel participated in the production of these "remanufactured" chips (which in and of itself would not necessarily be an ethical problem) and that he knowingly sold one of them to Dean Porter while representing it as a legitimate chip.

To conclude otherwise would require finding that either separately or in collusion, David Whalen and Dean Porter were lying about a matter which they had to know would create the possibility of significant repercussions for a long-term and well-known member of the club. I found no basis upon which to believe that they were doing so.

The sale of the chip under these conditions was a violation of paragraph 6 of the CC&GTCC Code of Ethics, which requires members:

6. Not to sell, exhibit, produce nor advertise non-genuines, copies, reproductions or restrikes of any item unless their nature is clearly indicated as such.

Furthermore, this sale was a violation of three other provisions of the club's Code of Ethics:

To conduct myself so as to bring no discredit to the Club or to impair the prestige of the Club or its members.
To base all of my dealings on the highest plane of justice, fairness and morality.

To represent casino collectibles as genuine only when to the best of my knowledge and belief, such items are in fact authentic, and when no significant question of their authenticity has been raised.

As indicated above, I think it would be helpful to have more information about the dealings between Mel and Dean, including the other suspected "remanufactured" chips, before concluding this matter and making a final determination as to what action should be taken by the board.

Therefore, I am recommending in Report 2002-01d that the President of the Club or other member of the Board at his direction, contact Dean Porter to encourage him to provide details regarding the other transactions in which he believes he was sold "remanufactured" chips that were represented as legitimate.

With respect to the situation discussed in this report, I recommend that the Board withhold taking any final action pending further response from Dean Porter. Should such further response not be forthcoming within a reasonable time, then I recommend that the board act on the information currently available.

As to what that action should be, if the board concurs with my conclusion that Mel knowingly violated paragraph 6 of the Code of Ethics, it appears that the only appropriate action would be expulsion from the club and prohibition from all club activities.

I also recommend that, once a final determination is made, this report and the board's action thereon be provided to Mel and thereafter made public by posting on the CC&GTCC Bulletin Board and publishing in the Casino Chip & Token News.

A club member came forward after Jim Reilly’s report had been submitted to the Board. This member, referred to as Confidential Club Member, (who wishes to remain anonymous, but whose identity is known to both Jim Reilly and Nate Pincus) has provided corroborating information that substantiates Dave Whalen’s version.

Jim Reilly in a supplemental section of his report was able to conclude, based in part on information provided by the Confidential Club Member, as follows:

This additional information does not change my opinion regarding the roles of David Whalen and Mel Jung in this matter. It does, however, reinforce the conclusion stated in Report 2002-01c regarding Mel's conduct:

"In combination, these circumstances compel the conclusion that Mel participated in the production of these 'remanufactured' chips (which in and of itself would not necessarily be an ethical problem) and that he knowingly sold one of them to Dean Porter while representing it as a legitimate chip."

To conclude otherwise would now require finding that either individually or in collusion, David Whalen, Dean Porter and the Confidential Club Member are all lying about a matter which they have to know would create the possibility of significant repercussions for a long-term and well-known member of the club. I have still found no basis upon which to believe that they are doing so.

In all respects, my recommendations remain unchanged from my original reports.

The Board of the CC&GTCC continued the investigation after Reilly submitted his report. David Whalen was interviewed extensively on several occasions. He provided more particulars that corroborated his earlier testimony. Dean Porter also provided additional information, including a formal complaint, specifying details on the specific chips that he alleges were non-genuine.

Board's Decision

The Board of the CC&GTCC unanimously finds as follows.

Based on the information contained in this report and the accompanying detailed reports of Jim Reilly, CC&GTCC Claims Director and other documentation gathered by the Board and included as exhibits, we find as follows:

1) That Mel Jung sold to Dean Porter a $2.50 pink Harrah’s chip without proper disclosure that it was a non-genuine chip. This is a violation of paragraphs 2, 3, 6 and 7 of the CC&GTCC Code of Ethics, which requires members:

CoE #2- To conduct myself so as to bring no discredit to the Club or to impair the prestige of the Club or its members.

CoE #3- To base all of my dealings on the highest plane of justice, fairness and morality.

CoE #6- Not to sell, exhibit, produce nor advertise non-genuines, copies, reproductions or restrikes of any item unless their nature is clearly indicated as such.

CoE #7- To represent casino collectibles as genuine only when to the best of my knowledge and belief, such items are in fact authentic, and when no significant question of their authenticity has been raised.

2) That Mel Jung was not truthful in the information that he provided to the CC&GTCC Claims Director in regards to the inquiry into the production and sale of brass core chips and therefore impeded such investigation. This is a violation of paragraphs 2, 3, and 13 of the CC&GTCC Code of Ethics, which requires members:

CoE #2- To conduct myself so as to bring no discredit to the Club or to impair the prestige of the Club or its members.

CoE #3- To base all of my dealings on the highest plane of justice, fairness and morality.

CoE #13- To cooperate with the officers of the Club in investigating and resolving problems which may arise, and complaints which may be made, and to provide such information to such officers as may reasonably be requested.

Based on these violations of the CC&GTCC Code of Ethics, the Board of Directors of the Casino Chips and Gaming Tokens Collectors Club has voted unanimously to expel Mel Jung from the CC&GTCC and bar him from all club activities.

Code of Ethics - Clarification

In regard to Code of Ethics #6

6. Not to sell, exhibit, produce nor advertise counterfeits, copies, reproductions or restrikes of any item unless their nature is clearly indicated as such.

Going forward, the Board will continue to interpret this provision of the Code of Ethics to mean that the chip/token/silver strike must be marked on its surface.

The Board will also be referring these definitions and marking requirements to the Club's Condition Description and Standard Committee for recommendations.

Note

The remainder of this report will detail the statements made by those involved.

David Whalen

The following is David Whalen’s description of his dealings with Mel Jung as written to Marty Kaplan.

Mel Jung 30 -35 chips changed hands (I ended up with a few)

Altogether we had three mailings take place + a few passed in person at shows.

Shipment A 12 slugs misc.

I was immediately disenchanted. Our negotiated agreement was for any chips he sent me, I was to fix and return half and keep the other half for my own use. His instructions for this shipment of twelve (12) chips, how he wanted his seven (7) and which five (5) I could keep. I knew right away he'd play a lot of hooky during 2nd or 3rd grade math. Besides, the slugs he intended for me were mostly Reliable Inc. proto-types, that with $20 - 30 labor and material I could bring their market value up to $10 - 12. I've never worked on them. Still have them. You don't suppose we could dust them to see if we can find some of his DNA on them? The seven chips I finished for him (reluctantly) were probably five Ranch House low denomination and a couple higher denomination slugs from somewhere else. You might want to phone me about the white chips in this batch.

Shipment B 11-12 Hard Rock non-denomination

These he sent me did not need to be re-encapsulated. All had been glued to something and had surplus glue and minor surface damage as a result of being glued. These required sanding and polishing. He told me to keep "one" of the chips for my troubles.

Random work for Mel (not mailed) 3 -4

Only a few chips, not more that four were transacted in this manner. These were the kind that were handed to me at shows with verbal instructions. Of noteworthy significance would be what transpired at Jim Mundings Crystal Park show. I had made myself a $2.50 Harrah's pink 16 insert chip. It was real nice and I was showing it off. Mel made me an offer of $200. I declined, told him it was for my personal collection. The second day of the show he approached me about making him one. I said sure but I didn't have any slugs. Which in this case would have been a yellow $2.50 16 insert drill canceled. He looked but said he didn't have any with him. Then turned to the dealer at an adjacent table and in front of another dealer (+ God, Allah, Buddha & the rest) and asked if he could borrow one.

End of story.

Shipment C 7 - 8 slugs Misc.

I remember two chips specifically in this shipment to be 50 cent Ranch House. These I coveted very much because I didn't have any in my personal collection. I never did the requested work on these slugs. I returned the slugs unfinished at Rene's first Palace Station show. That's when all the false accusations started.

Bonus disclosure Confidential Club Member was with me when Mel directed me to another dealer's table to see a specific chip and said that was the shade of pink he wanted on his chip. The Confidential Club Member says he doesn't remember which chip, but did know the purpose of the trip.

The following is an excerpt from Jim Reilly’s report:

David has told me that he produced specific chips as follows:

Three pink $2.50 Harrah's chips (he does not recall exactly when these were produced, except that all were made after the last chip show by Bill Akeman at Arizona Charlie's). He had a real one to use as a guide, made three copies. David kept one copy, Mel got one copy and the other two went to Dealer B and Dealer A (David is not sure which got the real one and which the final copy). Dealer A sold his to Member A in what David understood to be an $800 deal ($450 in cash plus chips). Thus, there is a 50-50 chance Member A's chip is a copy.

The following is an excerpt from Jim Reilly’s report:

David advised me that he has produced approximately 80-90 "remanufactured" brass core chips. He said that approximately 35-40 of these chips were produced specifically for Mel and recalls orders of 11, 12 and 15 chips. Some of these chips were produced from damaged originals and some from blank brass cores provided by Mel to David. Among these chips is the pink Harrah's $2.50 brass core which is the specific subject of this inquiry and which is discussed at length later in this report.

I met personally with David in Las Vegas last July and we discussed this situation for several hours. Since then, we have spoken on the phone and exchanged a number of emails. In an email dated December 3, 2001, David summarized the information he had provided to me as follows:

"About two and a half years ago, I purchased a couple of brass slugs at a show from Mel. I wanted to experiment restoring the plastic with polyester gel-coat. The experiment was a success. They came out looking pretty good. There's a pretty good way to differentiate. The plastic will easily dissolve with acetone, the cured polyester will not.

"At the next show (Arcadia) I took the restored chips and showed them to Mel. He asked, if he gave me some slugs would I restore them for him? I said I wouldn't know how much to charge, they are pretty labor intense. His offer was, for every two slugs he would give me, I fix one for him and get to keep one. I agreed.

"After a few days back in Las Vegas. I received a package of 12 slugs with instructions as to what to do with his 7 (most were Ranch House, Wells, NV). The 5 (my half ???) he gave me were all Reliable Inc. samples. I was very disappointed, they would require more labor that they would be worth restored. I still have them.

"I delivered Mel his chips at a poorly attended show in Crystal Park, CA. He and Joe Benon had adjoining tables. I showed them a $2.50 Harrah's chip I had restored for my collection. I had made it pink as a replica of N6438 in the Chip Rack. Mel offered me $200 for it. I told him it wasn't for sale.

"The next day he asked if I would make one if he provided the slug. I told him it would cost $30-$40 + the slug. He sent me to one of the other dealers tables to see a $500 brass chip. He wanted it as close as possible to that color. It was a little more like light salmon than pink. He said even though it was for his own collection, he could claim it was a dye batch over-run. He didn't have a slug with him. He borrowed one from Armin. He said he also had some brass Hard Rock chips he wanted me to work on.

"Shortly after returning to Las Vegas, I received a package of 12 Hard Rock chips and a few more Ranch House slugs. He told me I could keep one of the white Hard Rock chips for my trouble. I sent him an e-mail saying that it wasn't enough $$. He replied saying to send him a bill with the chips + two each of my cathouse chips. He said that by now we had done enough business, he should be able to operate on an account. To this point he had never paid me anything other than five Reliable Inc. slugs and a hard rock chip. I mailed him his chips + twenty some cathouse chips & a bill. I never received payment.

"Next I drove over to California to a show at Hollywood Park. I delivered some chips I had worked on for other dealers that I could have mailed. My main hope was to be able to collect from Mel. .... [JTR note: Omitted material related to another dealer.]

"Mel packed up and left the show early without paying me. When confronted by telephone, he stated he left because I had made him feel uncomfortable showing the "altered" brass chips. By now I had altered 25 -30 brass chips for him which I believe most were sold. Why should he feel uncomfortable, unless he had misrepresented them?

"Back to Las Vegas and soon another package of chips with a Borg-Warner color chart from Mel. His instructions were to make the chips various colors, matching the color chart as closely as possible. [JTR note: During our in-person conversation last July, David advised me that these blanks were all from the Ranch House in Wells, NV.]

"Mel stated that these are the color pigments used by Royce & Reliable Inc. Would that enhance the chances of the altered chips to be passed off as dye batch over-runs? I still have the color chart and maybe the instructions.

[JTR Note: David subsequently advised me, in response to my follow-up request, that he could not find the instructions.]

"Super Bowl weekend at the Palace Station I confronted Mel about the money he owed me. He asked how much it was and I told him again $185. He handed me a chip that was worth about $50 that he had marked $125 and told me I could keep the difference ( ? ? ? ). Not wanting to cause a public scene, I walked away. Later the confrontation continued at Armin's table. Armin asked him why didn't he just pay the man? He reached in his pocket and gave me $180.

The following morning I returned all of Mel's unworked on slugs.

"I've never sold Mel a $2.50 Harrah's "brass pink" chip for $200 - $400. I returned the chip to him that he borrowed from Armin at Crystal Park. The color was altered from yellow to pink. To this date the total compensation that I have received from Mel for chips = five Reliable Inc samples + one white Hard Rock chip + $130 labor & $50 for cathouse chips."

[JTR note: David told me in July that he actually produced three of the pink $2.50 Harrah's brass cores, one of which he retained himself, one was given to Mel and one to another individual.]

Jim Reilly’s evaluation of Whalen and information supplied by Whalen:

Several members other than Mel Jung identified David as the producer of "remanufactured" brass core chips (inasmuch as David admitted doing so, I deemed it unnecessary to identify the other members). None of them, not even Mel, whose comments were otherwise most critical of David's actions, claimed or even suggested that David had misrepresented the nature of his chips. The one chip which Mel agrees he obtained from David was, by Mel's account, represented as a "damaged pink" that had been "repaired".

There is a factual dispute between David and Mel Jung with respect to the question of whether David produced brass core chips for Mel, as well as with respect to the circumstances under which Mel came into possession of a "remanufactured" pink $2.50 Harrah's chip. Based on my personal observations, my lengthy discussions with David and reasons discussed more fully in (other sections of Reilly’s report), I have reached the conclusion that David was being truthful with respect to these matters.

Club member Mel Jung has been identified as the seller to Dean Porter of a pink Harrah's $2.50 brass core chip which is known to be one of the "remanufactured" chips produced by David Whalen (and addressed in Report 2002-01b).

Mel Jung

This is an excerpt from Jim Reilly's report:

There is disagreement between David Whalen and Mel Jung as to the circumstances in which Jung acquired the $2.50 pink Harrah’s. There is also disagreement between Dean Porter and Mel Jung as to what was said and disclosed during the sale of the $2.50 pink Harrah’s chip to Dean Porter. Jim Reilly posed questions to Mel Jung.

This is an excerpt from Jim Reilly’s report:

I posed a series of questions to Mel regarding this situation. Those which relate directly to the sale of the pink $2.50 Harrah's chip to Dean Porter are described in detail later in this report. Mel agrees that he obtained the pink Harrah's chip from David. On the other hand, he denies having anything to do with the production of the "remanufactured" brass core chips.

My questions and his answers regarding his acquisition of this chip were as follows:

JTR: "3. If you sold Dean this chip, from whom did you obtain it?"
Mel: "Dave Whalen"

JTR: "4. How much did you pay for it?"
Mel: "It was shown to me at another dealers table and was represented as a 'damaged pink' that had been 'repaired'. Cannot recall exact amount, but somewhere between $200-400 since other chips were involved with the other dealer."

JTR: "5. Please describe the circumstances of your purchase of this chip."
Mel: "As above with the additional comment that it way my intent to get this aberration off the market."

JTR: "6. If you bought and sold this chip, did you know that it was produced by David Whalen?"
Mel: "Yes"

Mel concluded his responses to my questions with the additional statement:

"Dave Whalen has never 'produced' chips for me and I have never had any brass core chips 'produced' to duplicate original chips."

On October 12, 2001, he emailed me again (in part) as follows:

"You may recall that I introduced you to this matter of Dave Whalen creating brass core remakes and have encouraged you to investigate the matter. It is clear that he admits to the activity which has created chaos among the chipping community. I recommend that he stop this activity and be reprimanded. Additionally he should be removed from the membership and banned from all shows and activities."

[JTR Note: Although I did speak with him about "counterfeit" brass cores at the convention, it was not Mel who first raised the issue with me and I initiated our first conversation on the subject. He did encourage an investigation into the matter and has been cooperative throughout my inquiry.]

Sale of pink $2.50 Harrah's "remanufactured" Brass Core Chip to Dean Porter

As noted above, David Whalen told me that he produced three pink $2.50 Harrah's chips (he does not recall exactly when these were produced, except that all were made after the last chip show by Bill Akeman at Arizona Charlie's). He had a real one to use as a guide and made three copies. One of these was made from the $2.50 chip Mel obtained from Armin, from which David removed the yellow plastic and replaced it with pink.

As also noted above, Mel disagrees with David's statement of how Mel obtained this chip. He did, however, admit selling the chip to Dean Porter. Our question and answer exchange regarding the sale of the chip was as follows:

JTR: "1. Did you sell Dean Porter a pink Harrah's $2.50 brass core chip."
Mel: "Yes"

JTR: "2. If so, did you sell this chip for approximately $500? Otherwise, please indicate the selling price."
Mel:" "Somewhere between $200-500."

JTR: "7. When selling it to Dean Porter, did you represent it as being a Harrah's original?"
Mel: "No"

JTR: "8. Please otherwise describe the circumstances of your sale of this chip."
Mel: "Informed Dean that I had it in hand and he 'Had to have it.' I told him that it was not an original chip by a long shot and that a chip repairman had created it. My policy has always been to divulge information pertinent to the item and have always maintained any $2.50 pink Harrah's was not original since there are no company records of one ever existing and I had never seen one in a collection or otherwise. This stance has been consistent to all collectors and dealers which can be attested by Howard Herz, Armin Pfaender, Joe Benon and Don Lueders, to name a few.

JTR: "11. Please describe the circumstances of the sale of these chips, specifically indicating what representation, if any, you made to Dean regarding the authenticity of these chips."

[JTR Note: This question was actually directed at chips other than the pink $2.50, but Mel answered it by referring to that chip.]

Mel: "I clearly warned him that the $2.50 was not a Reliable or Royce 600 product and that I had no knowledge of any originals in this denomination and color. He did not seem to care and 'Had to have it'."

In a subsequent email, Mel said:

After taking more time to review your inquiry regarding Dean Porter and the pink $2.50 chip, this situation could be resolved by my sending you a check to Porter for $500 and the return of the chip from Dean. This offer is not a contradiction to my position that I have always told Dean, to the best of my knowledge, the conditions of brass chips he purchased.

I have also reiterated my policy with him that I would buy back any chip he did not feel comfortable with and after numerous transactions, this is the first time he has indicated dissatisfaction.

Dean Porter

Dean Porter reluctantly filed his complaint. He was concerned that since the dealers he was accusing were prominent and long-time members, no action would be taken and he would be ostracized. After assurances by the Board and direct contact with Marty Kaplan, Porter sent an email on April 15, 2002, reproduced as follows:

This non-genuine brass core chip problem has given me a lot of sleepless nights. The dealers who sold me the non-genuine, fake, altered or whatever words you want to call them are selling these chips as original casino chips along with some great stories to make them very valuable.

I'm formally asking the CC&TGCC Board of Directors to put a stop to this problem anyway they can and try to prevent this from happening again in the future.

The dealers who sold me the chips as original casino chips are: Mel Jung, Dealer D, and Dealer C. I also have or had a Frontier chip (according to Mel Jung) that was altered and sold to me by Dealer E in 1994 or 1995.

From Mel Jung, I purchased a pink Harrah's $2.50 in 2000, a $5. Ranch House in 2000, a $5. Ranch House in 2001, a yellow $100 SilverSmith in 1995, and a $1. blue SilverSmith in 1995. I also purchased a green $1. Ranch House that had a problem I was aware of when I bought it. (I think it was one of David Whalen's early work.)

From Dealer D, I purchased four chips, all from the Ranch House. (One I got a refund when I reallized it was a fake). $1. white, $5. blue, $5 dark red, all purchased in 2000 except the one I got a refund on which was in 2001.

From Dealer C, I purchased $1. green Harrah's, a green $1. marbleized Harrah's, and a red $25 Ranch House, all purchased in 2000.

Thank you for looking into this problem.

These are excerpts from Jim Reilly’s report:

On June 14, 2001, I received the following further response from Dean:

"All the brass core chips I bought with one exception were represented as the real deal. The main reason I'm hesitant is If the club doesn't go thru with this it leaves me out on the limb. Believe me the sellers are old timers who have been there a long time. The new President had a meeting on this at the convention, and I get the feeling it's all going to blow over. I've mostly enjoyed my association with the club and hate to loose it. I'm with you when I say I feel this could destroy the CC&GTCC."

On June 20th, I received the following from Dean:

Hi: been out of town for a couple of days. In answer to some of your questions I know who I bought most of my chips from because I put a paper in with them to mark the year, price and initials of the seller. I have three $100 Crystal Bay chips which are not drilled I feel are OK. Some of the Crystal Bay brass I have came from Hank K. who was a pit boss there for several years.

I received no response to that message, but sent him another on July 25th ...

"Hi Dean ----- noticed in one of your BB posts that you mentioned having a $2.50 Harrah's pink, which we haven't previously discussed. Can you tell me which of the sellers you got that one from? By now, from the information I provided you previously, you should have some idea whether it's legit or not.

... to which I received the following reply, also dated July 25th:

"I got mine from Mel Jung as an original and paid over $500 for it. Dealer A also had one (original fake) at the convention which he showed me and I told him it was a fake and practically called me a liar. Dean"

"CONFIDENTIAL CLUB MEMBER"

Information received from a club member who has requested his/her name be kept confidential. This is the same person as the "Confidential Club Member" who is cited in David Whalen’s email to Marty Kaplan.

These are excerpts from Jim Reilly’s supplemental report.

In response to a call by me to him yesterday, I received a telephone call today from a member of the club who provided the information contained in this report. He provided this information on the condition that his name be kept confidential, a condition to which I agreed. This member did indicate, however, that he would be willing to confirm this information directly to the board so long as the board also agreed to keep his name confidential and not include it in any report regarding this inquiry which is made public.
This information relates to the production by David Whalen of a pink $2.50 Harrah's chip at the request of Mel Jung, as previously discussed.
This member advised me that he was present during the conversation between David Whalen and Mel Jung regarding the production for Mel of a pink $2.50 Harrah's chip. He told me that his recollection of the events is somewhat hazy, due to the passage of time, but that he did specifically recall the following:
During the conversation between David and Mel, Mel asked David to visit another dealer's table to see a $500 pink brass core chip, so that David could see what color Mel wanted his chip made. The confidential member does not recall which dealer Mel referred to, but told me that he only knew of three dealers who had $500 brass core chips, Mel, Armin Pfaender and Walt Gonski. He also does not recall whether or not he went with David to the other dealer's table.
The confidential member could not recall the name of the casino from which the $500 chip came, but thought it might be Crystal Bay. In reviewing The Chip Rack, it appears to me that the only casino to have issued a $500 pink brass core is Harvey's, Lake Tahoe. Nor have I discovered any illegitimate $500 brass cores.

Brass Core Report

Complaint by Dean Porter against Walt Gonski

Dated 12/27/02

This report will present the results of the investigation into an allegation made by Dean Porter against Walt Gonski.

In a complaint filed with the CC&GTCC by Dean Porter, he alleges that Walt Gonski sold to him non-genuine brass core chips without disclosing all information known about their true nature and/or origin at the time of sale. Specifically, Porter states that Gonski sold him (See Exhibit A):

$1 white Ranch House
$5 blue Ranch House
$5 dark red Ranch House

Following are a series of questions that were asked of Gonski along with his answers.

Did David Whalen repair and/or manufacture any chips for you?If so, what chips? Please provide a complete list.
Answer: No chip ever sold to Dean Porter came from David Whalen.
Did you sell any brass core chips to Dean Porter?
Answer: Yes
If so, what chips? Please provide a complete list.
Answer:
- 50 cent Green Ranch House
- $5 Red Ranch House
- $25 Black Ranch House
$25 White Ranch House – 2001 convention the same day he bought the chip he brought it back to me and I gave him a complete refund. None of these chips came from David Whalen. They came directly from the former Ranch House owners or from my personal collection.
Did you sell Dean Porter any of the allegedly non-genuine chips that are listed above in paragraph "A)"?
Answer: No
If so, which chips? Please provide a complete list.
Answer: N/A Gonski included the following statement with his response to the specific questions:

Regarding the 3 chips I did sell Mr. Porter, if he was not satisfied with anything I sold him why didn’t he come back to me and ask for a refund?

Mr. Porter has obviously bought many fake brass cores from number of people not “ME”. At this point I don’t believe he knows “what came from who”.

Mr. Gonski was subsequently contacted to clarify his response to Question #1. His response is as follows:

Regarding question #1. David Whalen never manufactured any chips for me. I gave him approx. 5 - 8 Ranch House brass core chips which were all fire damaged. The chips were all various denominations, $1, $5, and $25. He repaired all of the chips in the original colors, $1 Blue, $5 Red, and $25 Black. None of these chips were sold to Dean Porter or to anyone else. He has also on occasion repaired other non brass core chips for me. Such as removing glue from one side, reglueing a loose inlay, and straightening a warped chip.

FYI.... Look at the 1996, 1997,1998 , etc., issues of Chip Rack. And look up Ranch House brass core chips. Some strange listings for 50cent, and $5 chips. Are these real proto types ? Did Whalen make these too? Might be interesting to learn who provided the info for these listings. Also look at some of the listing for PMSC chips from Harrah's, Harvey's, and Silver Smith. Nate, this whole brass core thing goes way back long before Whalen ever came on the scene. Just some food for thought.

On October 23, 2002 Mr. Gonski was again contacted. He provided the answers to the following questions.

Question #1

You previously stated that you sold the following three chips to Dean Porter:

50 cent Green Ranch House
$5 Red Ranch House
$25 Black Ranch House

Where did you acquire these chips?

Answer:

I acquired these chips directly from the former Ranch House owner's family, in Wells, NV.

Question #2

Other than the three chips listed above, have you sold Dean Porter any other casino chip(s) including any prototypes, repaired, modified genuine brass core or any other type of chip?

Answer:

As I have previously stated. During the 2001 convention I sold a $25 white Ranch House chip to Porter. He brought it back to me the same day, and I gave him a complete refund.

Question #3

You previously stated “David Whalen never manufactured any chips for me. I gave him approx. 5 - 8 Ranch House brass core chips which were all fire damaged. The chips were all various denominations, $1, $5, and $25. He repaired all of the chips in the original colors, $1 Blue, $5 Red, and $25 Black.”

What was the nature of the repairs to these chips? What was done to them? Was the plastic chip material removed and replaced by new material? Please give a detailed description of the repairs.

Answer:

Most of the chips David Whalen repaired for me were fire damaged. I believe 1 was warped which he straightened out. A few had discolored brass from the fire. He cleaned and polished them. And, I believe he replaced the plastic on 2 or 3 of them (all in original colors ).

Question #4

You further stated “None of these chips were sold to Dean Porter or to anyone else.”

Does this mean that all of these chips are still in your possession? If so, would you be willing to present them for verification?

Answer:

Yes, to the best of my knowledge they are still in my possession. And yes, I am willing to present them for verification.

Question #5

David Whalen has stated that he made a $1 white Ranch House chip for Mel Jung. He further stated that Mel sold the chip at a convention and that you know who bought it. Do you have any knowledge of this $1 white Ranch House chip? If so, what do you know about it? Who bought it? Where is it now?

Answer:

I have no knowledge of a $1 white Ranch House chip that Mel sold at the convention. Nor do I have any info as to who bought it, or where it is or anything else relating to this transaction.

On November 1, 2002, Walt Gonski was asked the following question.

Dean Porter issued a check in the amount of $600 to you. The check was dated January 7, 2001 and was issued by Dean's Firearm's Ltd. What was this payment for?

Answer:

This is an easy question to answer. The $600 check he wrote to me was for payment of the 3 chips I sold him. They are the same 3 chips I have previously mentioned in my reply to your questions. Once again the 3 chips I sold to Porter :

50c green Ranch House approx. val. $300
$5 red Ranch House approx. val. $50
$25 black Ranch House approx. val. $250

I don't remember exactly the price I charged him for each individual chip,but the total was $600. I also don't remember the exact date I received his check. But Jan. 2001 sounds about right.

Follow up to Gonski’s inquiry regarding listings in The Chip Rack

Walt Gonski stated as part of his response to the request for clarification on Question #1 on the original request for information as follows:

FYI.... Look at the 1996, 1997,1998 , etc., issues of Chip Rack. And look up Ranch House brass core chips. Some strange listings for 50cent, and $5 chips. Are these real proto types ? Did Whalen make these too? Might be interesting to learn who provided the info for these listings. Also look at some of the listing for PMSC chips from Harrah's, Harvey's, and Silver Smith. Nate, this whole brass core thing goes way back long before Whalen ever came on the scene. Just some food for thought.

Allan Myers, one of the authors of The Chip Rack was asked about the odd chips listed in The Chip Rack. His response is as follows:

There are two off color PMSC Ranch House chips that we started listing early. One is a Green $5 belonging to Dale Seymour. Barry may still have it. It was made before 1994. The Yellow 50c first appeared in Herz' 1997 Auction #19. Howdy can tell you who purchased the chip. Both of these predate Whalen.

Information obtained from David Whalen:

Jim Reilly’s brass core report submitted to the Board of Directors on February 6, 2002 contained three specific references to Walt Gonski and specific brass core chips produced by David Whalen. Quoted from the report as follows.

First reference:

David estimated that he made these chips for dealers as follows:

Walt Gonski – more than 7, perhaps up to 15

Second reference:

Crystal Bay Orange $5 for Walt Gonski (repair to match original color)

Third reference:

7-15 Ranch House chips in various denominations (David can’t remember them) which were fire damaged and David replaced the original color plastic for Walt Gonski. One of these ($5 chip) was apparently sold by Walt at the convention for $100 and questioned after Mel told the buyer that it was a counterfeit. Not known to me if the buyer actually returned the chip for a refund or not.

Marty Kaplan subsequently questioned David Whalen regarding the specific chips he produced. He stated that he produced the following for Walt Gonski.

First reference:

Walt Gonski - $5 Crystal Bay Club (burnt orange)

Second reference:

Walt Gonski 15-16 chips (maybe as many as 18)
All were from the Ranch House and had fire damage
Most of Walt’s chips were done on a “fix one get one” basis. Some were worked on in exchange for other collectible chips.
This means that he should have gotten a little more than half back. Not true! I still believe that I have a couple of Walt’s slugs in inventory. This is because we hadn’t decided what to do with them.
I still have most of the slugs that I received as compensation from Walt. I’ve fixed a couple and they are now in my personal collection.

On October 23, 2002, David Whalen was again contacted and subsequently answered the following questions.

Question #1

You have stated that you did work on brass core chips for Walt Gonski. What was the nature of the work that you performed? Was the plastic chip material removed and replaced by new material? Please give a detailed description of the repairs.

Answer:

Walt gave me fourteen Ranch House chips. Half of them were for me to keep as compensation for working on his half. I still have two of his chips in a box of his consignment inventory. I did not do a $1 white Ranch House for Walt. I was able to repair a few of his chips that were heat warped and had surface scratches by sanding and polishing them. They obviously ended up the original color. They came out real shinny and a few thousandths thinner. I did change the plastic on two $25 Ranch House chips for Walt.

Question #2

Dean Porter has stated that Walt Gonski sold him the following chips:

$1 white Ranch House
$5 blue Ranch House
$5 dark red Ranch House

Did you produce or repair any of these chips for Walt Gonski? If so, which one(s)? And what specifically did you do?

Answer:

David Whalen did not respond to this specific question when asked. In all of his responses to previous questions he never mentioned making any of these chips for Walt Gonski,

Question #3

Not related to this investigation.

Question #4

You stated to Jim Reilly that you produced and sold a $1 white Ranch House chip to Mel Jung. Is this the only $1 white Ranch House chip that you produced? If not, who else did you produce $1 white Ranch House chip(s) for?

Answer:

I believe that I made multiple $1 white Ranch House for Mel, but I wouldn't swear to it under oath. I don't remember making any for anyone else.

Walt gave me four $1 Ranch House. Two were sold on eBay in the original condition (we split the $$$) and I still have the other two. This is why I was puzzled when Gene showed me the $1 whites he got from Dean. Of course, that doesn't mean Walt couldn't have gotten one in those swap sessions.

Information obtained from Dean Porter:

On May 28, 2002, Dean Porter emailed the following:

I found two more while getting ready for the Convention. Two white Ranch House, a $1 and a $5. One from Mel and one from Walt Gonski.

Dean Porter was emailed as follows:

Do you have any physical evidence of any of the chips that you bought from Gonski or Akeman such as sales receipts, your own notations or anything else that might show that you purchased the chips from them? Do you have anything that shows the date such as a notation or receipt? Please let me know.

Dean Porter sent the copies of his records. They are included as Exhibit B.

The cards indicate what he “paid, from whom and what year.”

He stated in another email as follows:

I make those orange tags when I buy them, so I know what I paid, who it came from (the initials) and the year I bought it. I hope that helps, Dean. (WG.00 would mean Walt Gonski, 2000)

Dean also included a copy of a check in the amount of $600 made payable to Walt Gonski. This is included as Exhibit C.

Dean was questioned about the $600 check. His answer was as follows:

Walt Gonski also sold me a $5. white counterfeit that I didn't have with the others and hadn't told you about before. The $1. and $5 whites were purchased at the same time. That's what the $600 check is for.

On October 23, 2002, Dean Porter was contacted and subsequently answered the following questions:

Question #1

Walt Gonski stated that he sold you the following chips:

50 cent Green Ranch House
$5 Red Ranch House
$25 Black Ranch House

Did he sell you these chips? If so, do you have any records of your acquisition such as the square orange cards that you keep with your chips? If he did not sell you these chips and you acquired them from someone else, do you have these chips in your collection? If so, do you have any records of your acquisition such as the square orange cards that you keep with your chips? Would you please send me scans or copies of the chips and the cards and any other records that you have regarding these chips.

Answer:

In my collection, the Ranch House 50c's came from Mel Jung and Armand Pfaender. The regular $5 red came from Mel Jung. The $25 black came from Armand Pfaender. The above were purchased in 1995 when I started collecting brasscores, and are OK.

Dean sent me his record cards and they are included as Exhibit D.

Question #2

You stated that Walt Gonski sold you the following chips:

$1 white Ranch House
$5 blue Ranch House
$5 dark red Ranch House

Did you buy all three at the same time?

Did you ever request a refund? If a full refund was offered, would you accept it?

Answer:

I asked for a refund on another counterfeit Walt sold me at the 2001 convention. He refused to give me a refund until I threatened to turn him in to the BOD. He then gave me a refund I think it was $350 in cash. I had purchased it for cash earlier on that first day of that convention.

I've never asked for a refund on the others as thay are in my collection and will be labeled as counterfeits from Walt Gonski. (or Mel Jung or Bill)

Question #3

You submitted a copy of a check in the amount of $600 to the Board. The check was number 22312, dated January 7, 2001 and was made payable to Walt Gonski. What was this payment for? Please give details.

Answer:

Answer is included in answer to Question #2 above.

Follow up questions were asked and answered as follows:

Please send me the cards and any records of your purchase of these three chips:
- 50 cent green Ranch House
- $5 red Ranch House
- $25 black Ranch House
Records were sent and are included as Exhibit D.
How did you pay for the $5 blue Ranch House and the $5 dark red Ranch House chips that you say you bought from Walt Gonski? Were they acquired at the same time?

Answer:

I don't remember how I paid for all the chips, but have no record of any other checks written to Walter Gonski. I do recall paying cash for the dark red $5. Ranch House.
You stated that you never asked for a refund on any chips from Walt Gonski except the $25 white Ranch House at the convention. Would you accept a refund for the other non-genuine chips if it was offered?

Answer:

I never asked for a refund from Walt Gonski after the convention because I'm putting them into my collection as fakes, and naming the people that sold them to me.

Physical examination of the chips named in the complaint

Two members of the Board of Directors examined the chips involved in this matter.

David Whalen inspected the chips. He feels that they are non-genuine but is not able to determine if he worked on any of them.

Discussion of the Information

Dean Porter has alleged that Walt Gonski sold him non-genuine brass core chips without disclosing all the information known about their true nature and/or origin at the time of sale.

Dean Porter has stated that Walt Gonski sold him the three specific chips that are the basis for the complaint. Walt Gonski has stated that he did not sell Dean Porter those specific chips. Gonski says that he sold Porter three other chips. Porter says that he did not obtain those chips from Gonski and that they were purchased from others.

Attempts were made to find corroborating evidence and information to substantiate statements made and evidence provided by Porter and Gonski.

Porter has stated that he keeps track of his chip acquisitions by recording information on a card that he keeps with the chip. Through use of a simple code, he records the name of the person from whom he acquired the chip and the date of acquisition. His written records specify that he obtained the chips in question from Walt Gonski in 2000. (See Exhibit B)

Porter made a payment to Gonski by check on January 6, 2001 in the amount of $600.00. (See Exhibit C) Porter states that this was for counterfeit $1 and $5 white Ranch house chips. Regarding the $5 white Ranch House chip that is not included in the original complaint, he stated “I didn't have with the others and hadn't told you about before.” Porter’s record card for the $1 white Ranch House chip indicates that he obtained the chip in 2000. The check that he states was payment for this chip is dated January 6, 2001.

Gonski states that the check for $600.00 was payment for the three Ranch House chips that he sold to Porter. The sum of the prices are in line with The Chip Rack values but is approximately 60% of Campiglia and Wells (2nd Edition).

David Whalen operates a business in which he repairs and reproduces chips. He is able to repair brass core chips by fixing the existing plastic and by replacing the plastic with new material. Whalen examined the chips in question and feels that all are non-genuine but is not sure if he worked on them.

Whalen has been asked several times about the chips he worked on for Gonski. His answers varied from as few as seven chips to as many as eighteen. Part of the confusion may be that the work was done on a “fix one, get one” basis. Whalen stated that “I did not do a white Ranch house for Walt.” He did state that he believes that he made multiple $1 white Ranch House chips for Mel Jung, but said “I wouldn’t swear to it under oath.”

There is no evidence that David Whalen produced or worked on any of the chips that Dean Porter alleges in his complaint. While Dean Porter has documentation showing information regarding his acquisitions, this information is unsubstantiated by any collaborating evidence. Over a year after the investigation was initiated, Porter subsequently disclosed that there was another non-genuine chip, a $5 white Ranch House that he states was obtained from Gonski. This disclosure, coming so far after the start of the investigation casts some doubt on the manner in which Porter maintained his records.

Other factors must also be considered.

Prototypes have always been a part of our hobby. We know that chip manufacturers made prototypes of chips to show to casinos. These may have included odd colored chips that may not have been produced by the regular manufacturing process. Prototype chips were made in small quantity – perhaps as few as a single chip – and were many times made in a rudimentary fashion. Some of the chips in question may be prototypes. Certainly, any chip that is odd colored would be suspect. There are Ranch House and other odd colored chips listed in The Chip Rack that date back prior to David Whalen producing chips. It has been alleged that others have produced brass core chips in the same manner as Whalen in the past but we have not been offered any specific evidence or proof. We do know that executives/owners at casinos have brought prototypes into the hobby. It is not possible to determine if this has any bearing on this specific complaint. But we have to consider that the chips that Porter alleges are non-genuine may be prototypes and that any seller may not have been aware of their true nature.

It is generally known that Dean Porter has perhaps the finest brass core collection in the hobby. He is certainly recognized as one of the most knowledgeable in this area of collecting. This does not absolve anyone who did not fully disclose the nature of any chips. Due to Porter’s expertise, there is expectation that he would have recognized the likelihood that chips that were off colored and chips that did not match up to known standards might not be genuine.

Porter was asked if he would accept a refund. He replied that “I'm putting them into my collection as fakes, and naming the people that sold them to me.” Porter wants to keep these chips in his collection. This indicates that they have a value, perhaps as much as he paid for them. Porter’s statement that he wants to keep the chips limits the options for resolving this matter since it would not be feasible to order that the chips be returned with and a full refund issued. While the complaint alleges serious misconduct by Gonski, it seems to be mitigated somewhat by Porter’s refusal to accept a refund.

Conclusion of the Board of Directors

Throughout the course of this investigation, much information has been obtained from the parties involved. There has been an ongoing effort to corroborate and substantiate statements made by the parties involved. Statements made by Dean Porter and Walt Gonski directly contradict each other.

Generally in our hobby, there is little documentation of transactions between club members. In attempting to resolve this matter, the lack of documentation has been the biggest deterrent in determining the veracity of the statements made by the parties.

None of the information provided has been substantiated by another person or by irrefutable evidence. Dean Porter has presented the only written evidence – his record cards that he keeps with his chips and a copy of a check made payable to Walt Gonski. The cards represent compelling evidence since they are his source documents and according to his testimony, prepared at the time a chip is obtained. The other documentation that was provided was the $600 check. Porter and Gonski each had a different explanation for this payment.

David Whalen has given information to those investigating this matter on several occasions regarding the chips he worked on for Gonski. At no time has he stated that he made any of the chips for Gonski that are the subject of Porter’s complaint.

Given all the information gathered in the course of this investigation and the lack of any substantial corroborating evidence, the Board of Directors of the CC & GTCC finds that there is not enough evidence to take any action in this matter.

The Board of Directors found as follows by a vote of 5-0:

In the matter of the complaint brought by Dean Porter against Walt Gonski, Porter alleged that Gonski sold him brass core casino chips without disclosing all information known about their true nature and/or origin. After investigating this matter, the Board of Directors of the CC&GTCC finds that there was no evidence of a violation of the Code of Ethics of the CC&GTCC.

The portion of Dean Porter’s complaint concerning Walt Gonski is closed.

Brass Core Report

Complaint by Dean Porter against Bill Akeman

Dated 12/27/02

This report will present the results of the investigation into an allegation made by Dean Porter against Bill Akeman.

In a complaint filed with the CC&GTCC, Dean Porter alleged that Bill Akeman sold to him non-genuine brass core chips without disclosing all information known about their true nature and/or origin at the time of sale. The chips that Porter alleges were sold to him are as follows:

$1 green Harrah’s
$1 marbleized Harrah’s
$25 red Ranch House

In order to make a determination in this matter, information was gathered from Bill Akeman, Dean Porter, David Whalen and two other club members.

This information was obtained in telephone conversations with Bill Akeman.

Regarding the two $1 Harrah’s chips, Akeman stated that they were obtained from a woman who brought several boxes of Harrah’s items that included chips to him at the Gambler’s General Store (GGS) in 2000. At the time, Bill worked in the GGS selling casino chips. Bill purchased items from this woman on several separate occasions. Akeman stated that Janice O’Neal, who worked for him at the GGS was present at the time the woman brought the chips into the store. Akeman also stated that he thought David Whalen was present at that time.

Included in the items purchased from the woman were three sets of $1 Harrah’s chips – a $1 green brass core and a $1 marbleized brass core chip. Bill kept one set for himself and sold sets to another club member and Dean Porter. Bill says that he explained the circumstances in which he obtained these chips to both buyers.

Regarding the $25 red Ranch House chip, Akeman stated that he does not recall ever having this chip.

Bill stated that he was not fully aware of all the chips he had for sale after his purchase of Jerry Wall’s inventory. He allowed customers to go through binders of chips that had been acquired from Wall before he had inventoried them. And that there were so many chips that he just doesn’t recall all of them.

Bill stated that he gave David Whalen a few $100 Reno Ramada chips that had cracks and that Whalen was able to repair them. These are the only chips that Whalen worked on for him. He has no recollection of any other chips being worked on by David Whalen.

Akeman also stated that he offered Dean a refund for the Harrah’s chips.

Dean Porter was asked about the transaction in which he obtained the two $1 Harrah’s chips.

Question:

Dean, When you bought the two $1 green Harrah's brass core chips from Bill, did he tell you how he obtained them? What did he tell you about these chips? You had to know that they were not actual chips that were played on the tables.

Answer:

Akeman told me a lady came into his store and told him that she had worked at the casino for a long time, and that she had those chips for a long time. When I saw them I knew they had never been in play, just like the other off-colored chips I bought from Gonski and Jung. I thought they were manufacturers samples at first, then later found out that Reliable had never made any marbleized chips and that Royce had never made any real brass chips. I've also been told that Dave Whalen was present when that transaction took place. Akeman swore to me that those were real. Dave Whalen told me he made a lot of chips for Akeman, but not those green ones. I believe he made the red $25. - Dean

Janice O’Neal was asked about Akeman’s acquisition of the two $1 Harrah’s chips. Her response was as follows:

It is correct that Bill got the Harrah's material when we were at the store. And, yes, I was present the day she brought them in. This woman came into the store and said she had worked at Harrah's for many years.

Sincerely, Janice O'Neal

Jim Kruse purchased the other set of $1 Harrah’s chips and was asked about the circumstances of that transaction with Bill Akeman. His statement is as follows:

He stated that he had purchased the same set of two $1 Harrah’s chips from Akeman, and that he was told by Akeman that the chips were obtained from a woman who had worked at Harrah’s who brought in boxes of Harrah’s items to his store.

During the course of the investigation (during April, 2002), David Whalen was questioned about the work that he performed for Bill Akeman. He stated as follows:

Bill Akeman - 4 chips

My request. I asked Bill if I could experiment with them?

He said OK, they weren't much value otherwise.

(2) Reno Ramada $100 white

These were not re-encapsulated, Just polished.

The CasinoChipGallery had nearly a full box they purchased in the J Wall inventory with hairline cracks in the majority. Two were given to me to experiment with.

Bill elected not to tamper with the rest.(came out pretty nice)

(2) Ranch House $25 black (fire damage)

One had minor damage, which was repaired with black epoxy mender.

The other had to be peeled and the entire plastic replaced. I figured since it was worthless I would have a little fun with Bill and make it green. There was no chip listed in the Chip Rack that color. When Bill saw it he said it was "scary", that he would not sell it, just sit on it for a while. Maybe even destroy it. I think that as of a few month ago he still had it.

Whalen was asked specifically about the $1 Harrah’s chips. He responded as follows:

Bill showed them to me when I was working with him at the chipgallery. I was there the day he bought them from a lady who claimed her ex-husband worked at Harrah's. I didn't pay that much attention to them. Later, Dean showed them to me at the Fiesta show this year. That time I believe I detected what could have been injection mold marks on the edge. That would mean they were machine made.

The machine that shoots the plastic chips does not exclusively make chips. The same machine can make jar lids, knobs, electric outlet covers etc. The only thing that is changed to make different products is the molds. These are produced by a Tool & Die maker. The mold to put plastic on a brass slug would be very simple. Just an aluminum plate with an 1 1/2" hole 1/8" deep, an injection passage and a vent hole. There are probably tens of thousands of these machines throughout the industrialized world.

Bill bought more than one set of these from the lady. I believe someone else has another set. Bill also told me he offered to refund Dean his money.

Dean Porter has presented his record cards that indicate that the chips were purchased from Bill Akeman in 2000.

Discussion of the Information

Regarding the two $1 Harrah’s chips, there is no dispute as to the basic circumstances of the sale and purchase. Two individuals witnessed the purchase by Bill Akeman of the chips from a woman who had a long-term connection to Harrah’s. Bill explained the details of the acquisition to both Dean and to the buyer of the other set of chips. At the time of the transaction, Dean felt that they were manufacturer’s samples. There is no evidence that suggests that Bill had any other information about these chips.

Regarding the $25 red Ranch House chip, Porter has provided his record card as evidence that he purchased the chip from Akeman. Akeman does not recall ever owning that chip but may have as part of the inventory that he purchased from Jerry Wall.

Conclusion of the Board of Directors

The evidence is clear that Bill Akeman obtained the $1 Harrah’s chips from an unrelated party and had no knowledge of their nature or origin beyond what he was told by the seller. He related the circumstances under which he acquired the chips to Dean Porter at the time he sold the chips to Porter. All the information known by Bill Akeman was related to Dean Porter at the time of the transaction.

Based on all the information gathered by the Board of Directors, it has been decided that there was no violation of the Code of Ethics of the CC&GTCC in the transaction in which Dean Porter obtained the two $1 green Harrah’s chips from Bill Akeman.

Dean Porter has presented written evidence to substantiate his claim that he obtained the $25 red Ranch House chip from Bill Akeman. Bill Akeman does not recall ever having this chip and does not believe that he sold the chip to Porter. According to his account, if he did sell the chip to Porter, he did so without any knowledge of the origin or nature of the chip. The only source of non-genuine brass core chips that we are aware of is David Whalen. There is no evidence that Whalen ever produced a $25 red Ranch House chip for Bill Akeman or for anyone else. There is conflicting information regarding this transaction and there is no collaborating evidence to support or contradict either party’s testimony.

Based on all the information gathered by the Board of Directors, it has been decided that there was no evidence of a violation of the Code of Ethics of the CC&GTCC in the transaction in which Dean Porter alleges that he obtained a $25 red Ranch House chip from Bill Akeman.

The Board of Directors found as follows by a vote of 5-0.

In the matter of the complaint brought by Dean Porter against Bill Akeman, Porter alleged that Akeman sold him brass core casino chips without disclosing all information known about their true nature and/or origin. After investigating this matter, the Board of Directors of the CC&GTCC finds that there was no evidence of a violation of the Code of Ethics of the CC&GTCC.

The portion of Dean Porter’s complaint concerning Bill Akeman is closed.