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Hobby Protection Act - NIA Input |
The FTC has requested public comment on the Hobby Protection Act of 1973. The NIA has provided the following input to be considered in any amendment to this act.
16 CFR Part 304
Comment--Hobby Protection Act Rule
APRIL 28, 2003
Introduction:
In the 35 years of organized
insulator collecting, glass and porcelain insulators have become highly
collectable and prices of these artifacts have escalated.
Along with the price increases, there have been increasing problems with
forgeries and alterations. With
prices in insulator auctions commonly exceeding $5,000 for a rare piece, it is
now quite profitable for parties to manufacture and distribute imitation items.
Many of these artificial insulators defy the experts when it comes to
authenticating the pieces.
The National Insulator
Association (NIA) spends a considerable amount of its resources in conducting
research and educating the insulator hobby about imitation and altered
insulators. However, with the
dramatic increase in interest in the hobby, the NIA is unable to keep pace with
those attempting to defraud the collector.
While the NIA has the
authority to ban individuals from the organization for unethical behavior, like
making and/or selling fake items, it has little recourse under criminal law to
have people committing such fraud held accountable for their illegal activities.
As a result, the NIA strongly
supports modifications to the Hobby Protection Act of 1973 to include other
hobbies across the board, but in particular the insulator hobby.
Insulator collecting had its
grass-roots start in the early 1960s when telephone and power company linemen
were in the process of converting overhead wire runs to microwave and
underground systems. The insulators
were often discarded and buried in local landfills during this period.
However, many of the glass and porcelain insulators of unusual shape and
color found their way into the early collections of these phone company and
power workmen.
By the late '60s, collectors
had formed small groups of likeminded enthusiasts and informal swapmeets took
place. The description and
cataloging of insulators began, and several small books were published about
insulators, as well as an early price list.
In 1969, the first National insulator magazine started publication – The Crown Jewels of the Wire – and is still in publication today.
Rapid growth of the hobby took
place during the early 1970s with the organization of several regional insulator
clubs around the country and the establishment of the NIA in 1973.
A corresponding surge of new collectors attended the increasingly popular
insulator shows and regional and National events began to be held annually.
In the 1980s, the rate of the
growth slowed somewhat allowing the organizational aspects of the hobby to catch
up. At the same time, the hobby
spread to nearly every state in the country and many more local insulator shows
began to occur. The one aspect that
did not slow was the rise in prices of these collectibles. Prices doubled, and in some cases tripled, during this
period.
The 90's saw a resurgent
growth of the hobby, with the number of NIA member clubs doubling. There are now 25 local/regional insulator clubs scattered
around the country! During this
period, catalog auctions of rare insulators began and it became common knowledge
that many insulators had multi-thousand dollar values. Perhaps the largest impact on the hobby during this period
was the uniting of the collectors through the Internet. The establishment of insulator collecting websites likely
accounts for the latest surge in the hobby.
Two websites stand out in the
group of 50 plus insulator related sites and these have been instrumental in
providing information and education to the hobby.
First is the NIA website (www.nia.org),
and second, the notable and primary site (www.insulators.info). This
latter site also is the focus for a 1500 member web-based collectors
organization know as ICON, or "Insulator Collectors on the Net".
In modern times, the most
recent significant impact on insulator collecting appears to be the Internet
auctions, notably eBay.
This has provided an additional and wide-reaching venue for trading
insulators. On any given day, one
can find over a thousand insulators for sale on eBay
alone!
Objectives and
Purpose:
The NIA, as stated in its By-Laws,
is a non-profit educational and scientific organization; its aim is to encourage
insulator collecting and to protect the interests of its members and collectors.
The NIA has established standards and ethics by which its members may
fairly deal with each other.
General
Information:
The National Insulator Association (NIA) was established in 1973, and is
an international organization of collectors and individuals interested in
communication and electrical insulators, as well as other artifacts connected
with insulators, such as telephone, telegraph, power transmission, railroad, and
lightning protection devices.
In recent times,
the annual paid membership has averaged 1,900 members.
The total number of insulator collectors is estimated to be at 10,000.
Residents from each of the states of the United States and all the
provinces of Canada have been NIA members, as well as many foreign nations,
including Germany, Great Britain, Australia, New Zealand, Czechoslovakia,
Holland, Colombia, and The Netherlands.
In addition to
protecting the interests of collectors and establishing standards, the NIA
promotes insulator collecting in many ways, including sponsoring local, regional
and national shows where awards for exhibits are presented.
Education and historical information are stressed in the NIA's judging
criteria.
NIA
Administration:
The
governing body of the NIA is its ten member Board of Directors, the core of
which are the elected President and three elected regional Vice-Presidents.
Membership
Information:
Any person or club interested in insulators, lightning rod equipment or
items related to collecting or historical activity, are eligible to apply for
membership.
First, it is important to
define the relevant terms concerning insulator reproductions. These definitions are incorporated into the ethics section of
the NIA Bylaws, the relevant portions of which are at Attachment 1.
The concerns of the hobby revolve around two types of
"reproductions": Imitation
insulators and altered insulators.
Imitation Insulators are ones
that purport to be, but in fact are not, original insulators, commemorative
insulators, or salesman samples. This
category includes, but is not limited to, reproductions, copies, replicas, or
counterfeits of original insulators, commemorative insulators or salesman
samples.
Altered insulators include
original insulators, commemorative insulators or salesman samples which have
been intentionally altered from their originally manufactured condition.
This category includes mechanical actions (e.g. sandblasting, grinding,
embossing modifications), heating, cutting and re-gluing, irradiation, dying and
painting, and non-factory carnival coating.
(A discussion of one specific aspect of insulator altering, changing the
color of the glass, is presented at Attachment. 2. This is a good example of the
complexity of the altered insulator problem. )
The NIA Bylaws state that no
one can produce imitation or altered insulators unless they are permanently
marked so that there can be no mistake as to their authenticity.
The wording in the bylaws was directly patterned after the verbiage set
forth in the Hobby Protection Act as applied to other collectibles.
Early on in the insulator
hobby cases of altered insulators were noted.
In the late '70s, numerous insulators started showing up with an
iridescent coating that gave them a "carnival glass look".
The problem is that the carnival coating was sometimes applied to
insulators at the factory for pieces used in a high radio frequency environment;
it became quite difficult to tell the original pieces from the altered
specimens. In the mid 1980s,
imitation (fake) insulators began to appear. First in limited quantities, but as the values of insulators
escalated, the incentive to make forgeries surged as well.
The NIA was able to keep track
of such items and to alert fellow collectors to the specific problems.
However, there has been an ever-increasing number of imitation and
altered insulators appearing, and since the mid '90s, it has been almost
impossible to keep the hobby adequately informed of the flood of fraudulent
examples. It is now to the point
that hobby members are at risk of their collections losing value due to the
onslaught of reproductions and altered products.
Future generations of insulator collectors are particularly at risk
through purchases at antique malls, flea markets, etc.
The hobby has been constrained
from stopping the manufacture and sale of bogus items by the lack of laws that
would make such activities illegal. Pursuing
the perpetrators in civil court has been most difficult due to the high cost of
proving an insulator is bogus. The
only avenue for criminal proceedings has been through the application of mail
fraud laws. In fact, not until this
past year has the NIA been able to gather enough evidence on a particularly
egregious case of imitation insulator manufacturing and distribution in
California. This particular case
(which has documented losses of over $100,000), is now in the hands of the U.S.
Postal Inspectors and U.S. Attorney in Sacramento, California – but it could
be years before a verdict is reached. Without
Federal laws specifically set forth to regulate the manufacture and distribution
of imitation and altered insulators, there is little incentive for people to
stop making bogus items.
The collecting of glass and
porcelain insulators began in the early 1960s and developed into a popular hobby
by the mid-1970s. Today there are
some 10,000 insulator enthusiasts throughout the country.
The primary organization representing the hobby is the National Insulator
Association – the mainstay of the hobby since 1973.
Imitation and altered
insulators have been an increasing problem for the hobby since the early days of
insulator collecting. Without a
means to press criminal charges for fraudulent activity, the growth in the
manufacture and sale of fakes continues to rise at an ever-increasing rate.
In light of these problems,
the NIA strongly supports enlarging the list of hobbies under the auspices of
the Hobby Protection Act to include the insulator hobby.
[NOTE:
The NIA would be pleased to provide detailed information about fakes in
the hobby and can provide draft sections for incorporation into the revised
Hobby Protection Act. Please
address all inquires to:
Thomas Katonak
President, National Insulator Assn.
1024 Camino de Lucia
Corrales, NM 87048
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