As I suspected when I first commented about the Silver Surfer coin contest, altering the coins is in fact illegal.
The U.S. Mint said in a news release Friday that it learned of the promotional quarter this week and advised the studio and The Franklin Mint they were breaking the law. It is illegal to turn a coin into an advertising vehicle, and violators can face a fine.
“The promotion is in no way approved, authorized, endorsed, or sponsored by the United States Mint, nor is it in any way associated or affiliated with the United States Mint,” according to the release. The federal mint did not say whether the studio or the private Franklin Mint would face a penalty.
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I have heard that it’s legal to do this to a coin ONLY if it’s NOT going into circulation.