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Corey R. ShanusSome of the problems can be addressed by simply having more knowledgable and experienced graders. The fact that the altered cards that Barry refers to ultimately came to light means that to at least some degree the problem is unqualified graders.
I love Chad's suggestion that the role of the grading company should be merely to opine whether the card has been altered. Because in today's world there is no problem getting prospective buyers/bidders quality images of cards, there is arguably no need to assign a numerical grade in order to describe the card's condition.
Another idea which I have espoused for some time is for a card to be assigned a grade with a margin of error attached to it, analogous to how political polling is done. I think we all recognize that there is a degree of subjectivity to grading; one person's 8 could easily be another person's 7. Suppose for example PSA went to half grades (e.g., a card could be slabbed as a 7.5) and recognized that there is a margin of error of +/- .5 to any grade. Under the system I am proposing, a 7.0 would be slabbed as a 6.5-7.5; a 7.5 would come back as a 7.0-8.0. The beauty of this method is that it recognizes that, due to the margin-of-error factor, some 7.0s are in fact better than some 7.5s and as good as some 8s. While I have no illusions that such a system will eliminate the incentive to alter cards, perhaps to some degree it will reduce the ridiculous difference in value between cards one grade apart and thereby reduce the degree of tampering.