Grading of polymer notes with holograms

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I would like to ask everyone's opinion regarding the polymer notes grading. How do you see the difference between Unc, Choice Unc and Gem Unc?

In my opinion, Unc would be a note straight out of a bundle, with no wear whatsoever, but with the scratches (and at times halos) commonly present on the holograms. See the image I provided, all the notes in this particular bundle of commemorative twenties had these very thin scratches all over the hologram, hardly visible in normal light, but very noticeable under a certain angle under bright artificial light.

What I call Gem Unc (or Choice Unc, I see no difference between the terms) is a note with a perfectly clear hologram or perhaps with a few very light scratches.

I give the AUnc grade to the notes that have seen some post-production wear and damage on the holograms, even though the rest of the note is in perfect condition. This wear would include small scratches that are non-vertical and halos, caused by the note being rubbed or bent against other notes or banknote counting equipment. Notes on the top and bottom of the bundle commonly have this damage. ATMs or cash dispencers used by tellers also damage the holograms, leaving scratches and indentations. Deep nicks caused by counting machines is another kind of damage that would reduce the grade to AUnc. Finally, I do not like to see fingerprints on the holograms either, but these can in most cases be removed with alcohol.

Does it look like my AUnc-Unc-GemUnc grades correspond to Unc-ChoiceUnc-GemUnc grades the others use?
Thanks for any insights.

The one problem I have is that some people automatically assume a note out of a bundle/brick should automatically be an unc note. If you ask any bricker they can tell you that even notes that are so called "uncirculated" can and should be graded less than unc.....if problems appear on the note
Remember that some notes in bricks have been handled internally, and new bricks are not treated as precious items..they fall on floors, they get thrown into bags, bricks get squashed against objects when pallets are moved, and even run over by forklifts....yes forklifts...
In my opinion a gem is just that... flawless...no scratches, nicks, marks, halos, or anything else.

The older version of the GPM catalog I have states the following with regard to hologram scratches for GCU65 or GEM UNC and CHCU63 or CHOICE UNC:

"Clear polymer windows have no hairline scratches"

For CU60 or UNC

"Clear polymer windows must have minimal hairline scratches"

I have determined that there is a high probability to see production related hairline scratches on banknotes with position number 11 to 19. Of course there are exceptions. The greatest probability of finding notes with minimal lines/scratches etc seem to be in the 41-49 range and 01-09 range of PN. Again there are exceptions.

However in a CPMS Journal December 2013, authors Gilles Pomerleau and Brent W. J. Mackie have suggested that scratches are usually not parallel and if it seen with a naked eye then the note is only UNC if that is the only problem. They report that small lines (I imagine lines as opposed to scratches - I am not sure about the difference) in clear window are normal. If these parallel lines are only thing wrong then the note should be graded Choice UNC.

Read CPMS Journal 2013 Page 118 for full article and exact text.

An important point is raised about other problems. I recently saw a note that was very highly graded but the centering was visibly poor.

And while mention is made of embossing/paper ripples of the 1935, 1937 etc notes I have found that polymer notes with heavy embossing of the intaglio are a true pleasure to look at. Unfortunately I have learnt the hard way that when these notes are kept in the plastic holders over a prolonged period the embossing diminishes substantially.

I have also learnt that the old adage about beauty is in the eye of the beholder. I have given very similar quality notes to two veteran collectors. One of them pegged the note at Gem UNC and another would not even consider it at UNC.

Lighting conditions, angle of view etc. make a big difference in spotting many of the "blemishes". This could easily go unnoticed when notes have a layer of plastic surrounding them.

Thanks Squid and Rupiah for your inputs. Further on the subject, I have a question about the Charlton grading, specifically the three highest grades (Unc, Choice Unc and Gem Unc). I have copied the guidelines for these grades below.

For the most recent and fairly common series (Frontier, Journey and possibly Birds), I question some of the requirements. For instance, an Unc note can have muted edges and corners, visible counting creases, banding strap marks, damage from ATMs or counting machines. I realize that for older series the rules will certainly apply, but I would never consider a polymer note with any of these flaws an Unc. Even the Choice Unc grade allows "a very slight soft corner, one very small counting flick". Is it reasonable to grade both older and most recent series using the same set of rules?

Also, I am not sure if both Choice and Gem Unc grades should be provided for the recent series. Just as Squid said, "a gem is just that... flawless...no scratches, nicks, marks, halos, or anything else". For the polymer series specifically, I think the Choice Unc grade is essentially the same as Gem Unc and should not even be provided.   

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GEM UNCIRCULATED - GEM UNC - GCU65
 1. A near perfect original note.
 2. Colours must be bright, original with exceptional eye appeal. Paper must be bright and fresh.
 3. The note must have near perfect centering with sharp square corners and edges.
 4. No noticeable impairments upon close examination: counting flicks, soft bends or machine marks, paper flaws, writing, pinholes, etc.
 5. The note must not be processed or pressed.

 CHOICE UNCIRCULATED - CHOICE UNC - CHCU63
 1. A near perfect original note with much eye appeal.
 2. Colours must be bright. The paper on older notes may exhibit minor toning.
 3. The note may be slightly off centre. It must have sharp edges and corners.
 4. No noticeable impairments upon close examination with the exception of one of:
 A minor original paper flaw prior to printing, a very slight soft corner, one very small counting flick.
 5. The note must not be processed or pressed.
 6. The note may have only one demerit point.

 UNCIRCULATED - UNC - CU60
 1. An original note, must not be processed or pressed.
 2. Colours must be bright with eye appeal. There may be noticeable paper toning, but no major distractions.
 3. The note may be noticeably off centre. Edges and corners may be muted, thus not sharp and precise.
 4. There may be minor flaws or defects resulting in up to three demerits, such as: visible counting creases (one demerit each), tight margin (one demerit).
 5. Banding strap marks, ATM or counting machine marks that have caused small indentations in the note are acceptable.
 6. Notes with blemishes or distractions, a small tear, nick, crease with broken fibre, including an edge bump or folded corner, would not receive an uncirculated grade.
     

Is it reasonable to grade both older and most recent series using the same set of rules?

It is very interesting to see the changes in the Charlton GPM catalog from some previous versions.

For what I do grading really does not affect me so I do not pay much attention to it. If I end up giving what I might have to someone I simply classify it as either UNC or not UNC.

Whether it is reasonable to grade both older and most recent Canadian notes using same set of rules depends on the desired outcome.

A quick scan of IBNS grading standards, PMG grading standards and WBG grading standards leads me to believe that Charlton GPM catalog probably tried to come in line with these standards. None of these standards specifically talk about scratches on holograms.

From what I gather the fundamental points in grading are the nature of handling related issues, folds, corner conditions, centering and registration. So hypothetically if a note is poorly produced but has no handling related issue, no folds, no corner rounding, good centering and registration then it can still qualify as some sort of higher quality UNC.

That seems to be the fundamental tenet of the three grading standards mentioned above. Again the key point is the level of handling related issues.

In that respect I imagine if the scratch marks or lines on a hologram are not a result of handling then they will not be used against the note still having it qualify at the highest level of UNC if there are no other problems. It would seem then that the scratch on the hologram which is a result of production and which may deteract will need to be reported as a comment or something.

I think what the Canadian Paper Money Society could be doing is to highlight conditions that show handling related issues and those that show production related issues. I think if the buyer becomes aware about the different things to look for in the notes and if this is readily made available then it would be very helpful.

Rather than assign only grades or numbers, adding descriptors will allow users to classify notes based on the level of these various non-handling related issues.

Perhaps something along the line of what has been produced on this website along with pictures giving examples would go a long way towards educating buyers.

http://www.owenink.com/banknotes/grading.html

One can begin to add different things to the columns depending on the types of notes. I have been recording images of these conditions and would be happy to participate in such an effort.