@rrhoover a common misconception. Section 331 of Title 18 of the United States code provides criminal penalties for anyone who “fraudulently alters, defaces, mutilates impairs, diminishes, falsifies, scales, or lightens any of the coins coined at the Mints of the United States.” This statute means that you may be violating the law if you change the appearance of the coin and fraudulently represent it to be other than the altered coin that it is. As a matter of policy, the U.S. Mint does not promote coloring, plating or altering U.S. coinage: however, there are no sanctions against such activity absent fraudulent intent.

@joshdance this not a big deal. As far as I can tell, you just can't deface them with the intent of defrauding -- ie, shaving off gold and then trying to pass it at face value or the like. There are thousands of machines that smoosh pennies into souvenirs (including at national parks) and magicians have been machining shell coins for some time.