NIA Board's Report to the General Membership Regarding the 
Results of its Investigation into Imitation EC&M Insulators 

by Steve Marks, NIA Past President

For the past seven years or so, serious questions have been raised about the authenticity of a group of insulators that have surfaced on the West Coast. The insulators in question include unembossed CD 735s, dramatic new colors of CD 120 CEWs and CD 123 EC&Ms, and a new style of glass block which has come to be known as the "Sierra Block." A "Dealer" (whose name is being withheld by the NIA because there are ongoing civil and criminal investigations), introduced many of these pieces into the hobby at various insulator and insulator related shows. 

From the beginning the NIA's Authentication & Classification Committee (hereinafter referred to as the" A&C Committee"), and the Dealer had an ongoing dialogue about these new finds and the Dealer was well aware that the NIA had questions as to their authenticity. The Dealer challenged the NIA on several occasions to prove that these pieces were fake. Several collectors had spent tens of thousands of dollars on these pieces. The uncertainty as to the authenticity of these items has been the source of great anxiety among insulator collectors over the past five years. Even collectors who did not purchase these specific items were concerned that someone had the ability to counterfeit insulators and thus damage the hobby. At the request of its members, the NIA undertook an investigation into these items in an attempt to determine their authenticity. The NIA's A&C Committee performed the majority of this work. The investigation has been costly and quite time consuming.

The first phase of the investigation began in 2000 and 2001 with the "Sierra Blocks" (the details of that investigation were published in the Spring 2002 issue of "Drip Points"). The results of that investigation led the NIA Board to form an opinion and belief that the "evidence of authenticity" offered by the Dealer to the A&C Committee regarding the "Sierra Blocks," was a complete fabrication. The NIA Board decided to confront the Dealer on January 22, 2002. The NIA alleged that the Dealer had committed an act that was "objectionable to the best interests of the hobby." "'Objectionable to the best interests of the hobby" as defined under the NIA's Code of Ethics, "includes, but is hot limited to, any action or item which is likely to cause financial damage and/ or loss, ill will, or injury to collectors or organizations involved in the collecting of insulators and related items. For example, a false or misleading representation of fact likely to cause confusion, and/or the possibility of the use of an insulator to commit fraud (either by the issuing party or through a subsequent party)." 

The NIA further alleged that the Dealer had violated various provisions of the NIA Code of Ethics, including the provision that prohibits NIA Members from manufacturing, advertising, exhibiting or introducing into the hobby for distribution (through buying, selling or trading), any imitation insulator that is not plainly and permanently marked "reproduction" with the calendar year in which such item was manufactured. "Imitation Insulators" are ones that purport to be, but in fact are not, Original Insulators. This category includes but is not limited to reproductions, copies, replicas, or counterfeits of Original Insulators. The Board also had concerns that the Dealer had knowingly misrepresented the rarity and value of various insulators he had offered for sale or trade. 

The letter also advised the Dealer that it was the NIA's belief that the results of its investigation into the "Sierra Blocks" called into question all of the other "new finds" that the Dealer had introduced to the hobby. It was hoped that the letter would generate a dialogue between the Dealer and the NIA. The NIA offered the Dealer the opportunity to respond to the allegations in writing, in effect advising him that the insulator hobby deserved to know the truth about the "Sierra Blocks," and that this was his opportunity to provide that information in his own words. The letter also suggested that he might. want to consider offering collectors who purchased these items a refund. The NIA offered the assistance of its Ethics Chairman to act as a point of contact and coordinator for refunds. 

Rather than responding with answers to the Board's questions. the Dealer hired an attorney who threatened legal action against certain NIA Board and A&C Committee Members. In a letter dated February 1, 2002, the attorney demanded a retraction of the NIA's "libelous statements," and threatened suit if any information regarding his client or the insulators in question were provided to the NIA General Membership. The Board responded with a letter dated February 7, 2002, which stated (and bears repeating in this report), that the NIA is a non-profit corporation formed for educational purposes, whose Board and Committee Members are unpaid volunteers. It is the NIA's goal to encourage growth and public awareness of the insulator hobby through collecting, dealing and educational endeavors; protecting the interests of insulator collectors and dealers; and establishing standards and ethics by which insulator collectors and dealers may fairly deal with one another. The letter went on to state that it was the NIA's belief that this particular matter was a matter of public concern, and that the NIA Board Members feel strongly that they have an ethical obligation. and are duty bound. to share their opinions concerning the authenticity of insulators with the General Membership. 

This was met with a second letter. from the Dealer's attorney. dated February 12. 2002. threatening legal action again if any information was provided to the NIA General Membership. In a letter dated February 21, 2002, the NIA Board responded that it believed that it had conducted a fair and independent investigation and had properly exercised its First Amendment Rights as an organization, and that despite its requests it had received no substantive information from the attorney or his client. The Board warned that any legal action filed against the NIA would be ill advised and that the NIA was prepared to take all necessary steps to uphold its Constitutional Rights. On Feb. 11th, the NIA Board confronted a second Dealer. Although that Dealer received his letter on February 19, 2002, he has never responded to the allegations. The NIA Board never heard from the first Dealer's attorney again.

Because the Board had now formed an opinion and belief as to the credibility of these two dealers, it decided to investigate the dramatic colored EC&Ms that were also introduced to the hobby by these two dealers. The Board contacted several collectors and friends of these two dealers. As a result, in August of 2002, the A&C Committee received information from a collector that led the A&C Committee to a series of discussions with a Confidential Informant. These discussions then resulted in a Northern California Deputy District Attorney contacting the A&C Committee in September 2002. The DA indicated that he was in possession of what he believed were materials possibly utilized in the manufacture of insulators. The DA indicated that the items came from a Confidential Informant who obtained them directly from one of the Dealers the NIA was investigating.

In October 2002, the A&C Committee was given the opportunity to inspect the suspected molds and insulators. The A&C Committee inspected a cache of EC&Ms. There were 29 green black glass "M-Mold" pieces; 8 clear "J-Mold" pieces; 1 peacock "J-Mold" piece; a broken aqua "M-Mold" piece; and a 30th green black glass "M-Mold" that appeared to have been sandblasted to make it look old. In addition to the insulators, the A&C committee observed three mandrels for making threads in glass insulators, two of which were not for EC&Ms, one of which was; a well made steel EC&M "M-Mold" (button on the reverse), which appeared to have been re-worked, having been previously used to make "L-Mold" pieces (button on the front); and a cruder steel mold similar to what has been classified as a "J-Mold."

The A&C Committee had the opportunity to place "J-Mold" and "M-Mold" pieces into the molds and noted that while the "M-Mold" pieces fit, the "J-Mold" pieces did not. This has led the A&C Committee to believe that the cruder steel mold may have been used for another style of EC&Ms. No questionable CEWs were observed, however, there was one questionable threadless, which had been broken in half. There were several "Sierra Blocks." There was also a plaster cast of a 130.1 Cal. Elec. Works (which the DA accidentally and unfortunately broke).

The A&C Committee took 63 pictures documenting "the evidence." (Presented are several pictures showing the insulators, molds, & mandrels.) The molds, mandrels and insulators were then locked-up for safekeeping in a police agency property locker. As a result of this inspection, the A&C Committee formed an opinion and belief that the "J, L and M mold EC&Ms" were Imitation Insulators (i.e. counterfeit, fake, etc.). Because this now appeared to be a criminal matter (i.e. fraud, theft by deception, mail fraud, etc.), a determination was made to keep this information confidential. 

The U.S. Postal Inspectors were in fact investigating the matter and requested the NIA's assistance in obtaining a list of victims and documentation of their losses. They required documented losses in excess of $100,000 in order to prosecute. To that end the NIA Board solicited information regarding suspect insulators from collectors in the December 2002 issue of "Drip Points" and on "Insulator Collectors on the Net" (ICON). In that same issue, the NIA Board provided a quick reference guide to identifying "J, K, L, M and N mold style EC&Ms," (which was also subsequently published in greater detail in the January 2003 issue of "Crown Jewels of the Wire" magazine), and published its opinion and belief that "J, K, L, M and N mold style EC&Ms" are Imitation Insulators. The Board also made a determination that these particular insulators were "objectionable to the best interests of the hobby" (i.e. likely to cause financial damage and/or loss or injury to collectors or organizations involved in the collecting of insulators, and the possibility of their use to commit fraud)."

By the beginning of 2003, the NIA Board had collected what it believed was enough information for the Postal Inspectors to proceed with their case, and therefore turned that information over to them. The Postal Inspectors, through a Federal Grand Jury Subpoena dated January 10, 2003, took possession of the molds, insulators, and mandrels that were previously in the possession of the Northern California DA's Office.

In response, the Dealers under investigation appeared to have started a campaign of disinformation to try to "legitimize" the insulators that the NIA had exposed. One Dealer also contacted several A&C Committee Members with more threats of legal action,. not only against the NIA Board and A&C Committee Members. but also against the collectors who were providing the Postal Inspectors with testing samples. And, in the A&C Committee's opinion, these Dealers staged a "new find" of another imitation EC&M. The constant threats of litigation, and the pending criminal investigation by the US Postal Service, unfortunately delayed the dissemination of information to the NIA General Membership. The NIA Board was very aware that its Members wanted answers and proof regarding the EC&Ms, but under the circumstances that information needed to be withheld at that time.

In June of 2003, the Postal Inspectors informed the A&C Committee that while the dollar amount for damages had been met, they were concerned about criminal prosecution (which requires a higher burden of proof than civil actions), because the majority of the transactions between the collectors and the Dealers were conducted in cash and without receipts (like most hobbies). They also informed the A&C Committee that the molds, mandrels and insulators were being sent to the government's Dulles Forensic Laboratory for testing.

On August 11, 2003, the A&C Committee was advised that the U.S. Attorney reviewing the case was declining criminal prosecution at this time due to the lack of documentary evidence (specifically lack of receipts tying the victims to the Dealers). Although the U.S. Attorney had documentation for $50,000 worth of purchases, the government's threshold to prosecute is currently $100,000. The possibility for criminal charges against the two Dealers, however, still remains.

On this same date the Postal Inspector advised the A&C Committee that the Dulles Forensic Laboratory had completed preliminary testing on one of the molds. and had determined that it was of modem production and not antique at all. That mold was also determined to be the mold from which a peacock blue EC&M was made. The Postal Inspector went on to indicate that the evidence that the insulator was a fake was "incontrovertible." It is also Dulles' opinion that the mandrels and insulators are of recent production. The A&C Committee believes that a report will be written by Dulles detailing their observations and will be available at a later date. If the A&C Committee is able to obtain a copy of that report (it may be withheld due to the ongoing Postal Service investigation), it will publish it in a future "Drip Points." 

The A&C Committee has also learned from the government's forensic laboratory, that there are in fact scientific tests available in the private sector that will definitively determine the age of glass. The A&C Committee has received samples of various suspect insulators (not just J, K, L, M and N mold style EC&Ms which, as mentioned above, the NIA Board has already determined to be Imitation Insulators), and control samples, donated by various collectors, which the A&C Committee will be submitting to an independent laboratory for analysis. The results of these independent tests will be published in "Drip Points."

In the meantime, the government's forensic laboratory is sending the seized insulators, mandrels and molds back to the Postal Inspector handling the case to preserve the chain of custody, and for safekeeping until more documentary evidence is obtained. This evidence would also be available through subpoena to anyone (or any group of individuals), pursuing a civil action against the Dealers. Also, if any collectors come across J, K, L, M and N mold style EC&Ms for sale, they should immediately notify the NIA's A&C Committee, who will in turn alert the Postal Inspector. The Postal Inspector could then issue a "Cease and Desist Order," which if violated, would result in immediate criminal prosecution.

Respectfully submitted, Steven Marks, NIA First Past President

EDITOR'S NOTE

The opinion and accompanying photographs are being presented to the membership of the National Insulator Association this month by its board of directors. Crown Jewels felt the opinion is sufficiently important to be presented to hobbyists as a whole.

Opposing views are welcomed by Crown Jewels, and will be published.