investdrinks (blog)

Liv-ex: fine wine prices fall by 15% in 2011

2012-01-04T09:19:00.001Z

From the Liv-ex blog:

'The Liv-ex Fine Wine 100 - the fine wine industry's leading benchmark - fell 3.90 per cent in December. Having declined for six consecutive months, the index closed at 286.33 - down 14.85 per cent for the year.'

Read the rest here.

Good analysis of these figures by Chris Kissack, the Wine Doctor here.

Nouveau World Wines Ltd: brief news update

2011-12-21T15:04:00.000Z

The position as it stands today is that six people remain on police bail. They will return on bail in April 2012. No charging decision has yet been made.

Beaumont Vintners Ltd: proposal to strike off

2011-12-09T13:40:00.005Z

Anyone contacted by wine investment company, Beaumont Vintners Ltd, should be aware that the company faces a proposed strike off for non-compliance as the annual return should have been filed on 16th July 2011. The strike off and dissolution of the company is in abeyance following an objection by a third party.

Following a message from one of their customers, who had had difficulties contecting Beaumont, I phoned Beaumont and spoke to an unnamed 'senior broker', who became rude and agressive when I asked him about the proposed strike and asked to speak to Samuel Philips, the director.

Beaumont Vintners Ltd store wines in abonded warehouse at EWGA Ltd in Carnforth, Lancashire. EWGA have no connection with Beaumont Vintners Ltd, apart from offering storage facilities. Anyone with concerns about their wines should contact Simon Thompson at EWGA on 01524-737101.

I would certainly not buy wine from Beaumont Vintners Ltd.

Response to my email message from Samuel Philips

(This response was sent on Saturday 10th December 2011. Unfortunately due to the volume of emails I receive I didn't find it until 13th December. My apologies.

The annual return has now been filed with Companies House.)

Dear Mr Budd

Further to your e-mail below, I have taken your notes on board. The problem has now been rectified and will be altered with companies house within 48 hours. The annual return has now been submitted. All of our clients are welcome to contact EWGA at any time to verify the safe haven of their wine.

If there is anything else I can help you with please don’t hesitate to contact me.

Kind regards

Samuel Phillips

Director

Beaumont Vintners Ltd

54 Fulham High Street

London

SW6 3LQ

Tel: 0203 130 0314

Email: info@beaumont-vintners.com

21st January 2012
The proposal to strike off has been withdrawn. However, I'm still receiving messages from the clients who are having problems contacting the company.

Seale Wines Ltd: message from Official Receiver

2011-11-28T18:50:00.000Z

'I can confirm that on 23 November 2011 a winding up Order was made against Seale Wines Ltd (“the company”) on the petition of the Secretary of State, on public interest grounds. On the making of the winding up Order the Official Receiver was appointed as liquidator of the company. On the making of a winding up order the Official Receiver has a duty to investigate the cause(s) of failure and generally, the promotion, formation, business, dealings and affairs of the company, pursuant to section 132 of the Insolvency Act 1986. As liquidator of the company the Official Receiver has a duty to realise any assets or property of the company for the benefit of its creditors. Furthermore, in the event of any misconduct having taken place in the company the Official Receiver has the power to apply to court for the disqualification of anyone that may have acted as a director of the company, pursuant to section 6 of the Company Directors Disqualification Act 1986.

Anyone that is owed money by the company should send me an email with the following information:

Your full name;

You full postal address;

Details of much you are owed;

Details of your what your purchase/investment was for;

Any other information you feel may be of assistance.

Once I have your details you will be added to the list of creditors in the liquidation proceedings and as such you will be sent a copy of the Official Receiver’s Report to Creditors within the next 8 weeks, by which time I hope to have gathered some more information and also interviewed Mr Seale.

Kind regards

Matthew Stone

Senior Examiner

The Official Receiver's Office | Public Interest Unit

21 Bloomsbury Street | London | WC1B 3SS

DX 120875 Bloomsbury 6

T: +44 (0)20 7637 6417 | F: +44 (0)20 7637 6390

E: matthew.stone@insolvency.gsi.gov.uk | www.bis.gov.uk/insolvency'

Clampdown on land bankers

2011-11-22T23:14:00.001Z

Reports here of various arrests, complusory liquidators and voluntary liquidators amongst land banking companies largely based in the Bromley and North Kent area. Frequently there are links between land banking companies and those offering wine investments.

Report here in the Financial Times on 16th November 2011 on arrests made by the FSA, although no charges as yet.

Series of reports here from The Mirror includes reports on arrests by the FSA, the collapse of Countrywide Land Holdings into voluntary liquidation, the complusory liquidation of Regency Land and the apparent flight of a director to Northern Cyprus.

Eighteen55 Clarets still trading?

2011-11-19T08:30:00.001Z

I have been contacted by several clients of Eighteen55 Clarets Ltd who have been unable to contact the company. I have had no success either. The company was founded on 23rd June 2008 and is currently registered at 55 Denmark Hill, Camberwell, London SE5 8RS. In its short life proceedings by Companies House to strike off and dissolved the company have been started and suspended twice. Until 29th August 2011 Altaur Rahman was the director. On the 29th he resigned and was replaced by Stephen Paul Bradshaw.

I would be grateful if Mr Bradshaw would let me know what is the current possition, so that I can inform his concerned clients.

See previous post on this company here.

Vin Bordelais Ltd – one to avoid

2011-11-17T12:20:00.001Z

Bordeaux UK Ltd

Vin Bordelais Ltd (7.11.2011) with logo and identical phone number

Yesterday I asked Ian Vanderhook about Vin Bordelais Ltd and its relationship with Bordeaux UK Ltd. Vanderhook maintains that Vin Bordelais Ltd is a separate company but that he has a 3/4 person office there in Reigate. He said Vin Bordelais Ltd's sole director – Lawrence Douglas Adams – wants to buy Bordeaux UK Ltd. A brief phone call with Lawrence Adams (Douglas Company Services Ltd and sole director of Vin Bordelais Ltd) this morning confirmed that some discussions had taken place.

As already noted in a previous post Vin Bordelais Ltd initially used on its website the logo of Bordeaux UK Ltd and its phone number. The logo has now been removed and the phone number changed on Vin Bordelais' site. investdrinks is also aware that staff who previously worked for Bordeaux UK Ltd are now contacting customers of Bordeaux UK on behalf of Vine Bordelais Ltd.

Anyone contacted by Vin Bordelais Ltd is strongly urged to have nothing to do with this company until it can properly established that it is not a phoenix version of Bordeaux UK Ltd – now in liquidation.

Furthermore any company claiming that they can assist Bordeaux UK Ltd clients to sort out the mess created by the company going bust should be treated with great suspicion as the affairs of Bordeaux UK Ltd are now in the hands of the liquidator.

Vin Bordelais Ltd – amended version 12.11.2011 – logo removed and phone number changed

Bordeaux UK Ltd – officially bust – deficit nears £4 million

2011-11-16T23:32:00.014Z

Marriott Hotel, Bexleyheath

Following a meeting today of the sole director and the sole shareholder (Ian Vanderhook/ Ian Van Der Hook in both instances), Bordeaux UK Ltd (founded in 2002) was placed in voluntary liquidation and the creditors meeting, held at the Marriott Hotel shortly afterwards, approved the appointment of Nedim Ailyan (Abbott Fielding Ltd) as the liquidator.

Papers presented at the meeting showed that contrary to Ailyan's earlier optimism that the deficit might be less than £250,000, the actual deficiency is currently £3.780 million* (£3,780,112.49p to be exact). There are £3.1 in assets including £67,000 in the bank and the rest stock. There are around 360 creditors – almost all of them private investors for sums ranging up to £559,000. The only wine trade creditors appear to be Ditton Wine Merchants in for £55,000 and Wine networks for £10,000.

For a number of reasons it is very likely that the deficiency will rise. Firstly Bordeaux UK has not submitted a tax return to HM Revenue & Customs since their 2007 return, so there is likely to be more corporation tax and PAYE to be paid adding to the £63,720 already owned to HMRC. Ailyan said that he was not satisfied that the company database was accurate. It was clear from the meeting that a number of creditors thought they were owed substantially more than was listed on the creditors schedule. There are also some 32 creditors who have zero against their name because what they are owed has not yet been established.

There is also some dispute over the value of the wine in the Bordeaux UK account at Octavian Vaults. The company estimates this to be between £700,000 and £800,000, while Octavian's value (cost price) is £289,101.

Ailyan suggested that on the current figures creditors may get back 47/48p in the £1. This will obviously depend upon what the deficiency is once all the figures are in and the costs associated with the liquidation. My guess after yesterday's meeting is that the payout may well be lower.

I was at the meeting representing HG, who had bought 5 cases of 2009 Château Mouton-Rothschild on 8th February 2010 for £10,000 a case totalling £50,000. I asked Ian Vanderhook (for the sake of simplicity I'll use this version of his name) how he was able to sell 2009 Mouton in February 2010 well before the château had released its price for the 2009 and how many cases it was putting on the market. In response to my question asking him when the price of the 2009 Mouton was released, Vanderhook blustered that the date varied from year to year. He also claimed that the merchants and brokers with whom he dealt would have given him the price. This would appear to be highly unlikely as they would neither know the price nor the size of their 2009 allocation – a vintage that was obviously going to be in great demand.

Well so it does but only between May and June, even possibly early July but most normally some time in June in the year following the vintage. The price is certainly never released in early February, which is a good six weeks before the wine world descends on Bordeaux to taste the latest vintage after which the en primeur campaign gradually cranks into action. It normally takes until late June before the prices of the top wines, like Mouton, are released. The end of March/beginning April 2012 will see the 2011 tasted.

In the 'company history' presented to the meeting Vanderhook stated: 'The Company was set up by Mr Ian Vanderhook, who remains the sole director of the Company, in order to take advantage of his experience gained working for a company that specialised in the sale of fine wine.'

Despite this claim of 'experience' Vanderhook made it clear from this and other responses during the meeting that his understanding of how the fine wine market works appears to be still sketchy even after running a 'wine investment' company for the last nine years. Perhaps hardly surprising as Vanderhook admitted that 'his experience' came from working a maximum of two weeks for James Hewitt Associates Ltd, which was closed in the public interest on 12th September 2002 following a petition by the DTI. Bordeaux UK Ltd was fired up a week later on 19th September 2002 with 23-year-old Vanderhook as the sole director. Prior to his brief stint at James Hewitt Associates, Vanderhook told the meeting he was a lift engineer.

Vanderhook (VK) was asked whether Andrew Dunne, who effectively ran Ransby Hoare Ltd, Liquid Acquisitons Ltd and James Hewitt Associates Ltd - all closed in the public interest, had had any involvement in Bordeaux UK Ltd. VK said that Dunne had been involved in some staff training but was unsure when this was – 'might have been two or four years ago'. I asked VK whether he had met Dunne, while he was at James Hewitt Associates Ltd. "No," was VK's response as it was to my question whether the James Hewitt Associate's database has been transferred to Bordeaux UK Ltd.

VK insisted that Bordeaux UK Ltd had been set up properly with the assistance of his father, I understand is a policeman. Given VK's very limited experience in 2002 and continuing lack of knowledge about the fine wine market combined with his admitted weakness in administering a company, this all seems a decidedly unlikely scenario. More plausible is that Andrew Dunne chose VK as the next young man to follow on from 23-year-old James Hewitt.

A creditors' committee was formed at the end of the meeting. It includes someone from HMRC specialist investigations, which should ensure that the right questions are asked whether they will be to the liking of Ian Vanderhook remains to be seen.

Ailyan stressed on several occasions that both the FSA and Scotland Yard were investigating some other failed wine investment companies, although to date Bordeaux UK Ltd is not one of these.

* 18.11.2011. Please note that these figures (assets, deficiency etc.) are calculated from information supplied by Ian Vanderhook. Now that the liquidator has been appointed these figures will be investigated. It is not clear, for instance, whether the stock listed with a book value of £3,039,101 is calculated from the cost price value provided by Octavian Vaults or from a separate valuation.

22.11.2011: I have been informed by Nedim Ailyan that the value of the stock at Octavian is based on Vanderhook's valuation. This stock is due to be valued this week but given "the paucity of information" provided by Vanderhook to the liquidator it would seem all to likely that the stock in Octavian is worth less than the 'book value' of £700,000-£800,000 given to the meeting. The rest of the £3,039,101 is made up of 2009 (£2 million) and 2010 (£250,000) Bordeaux en primeur orders placed with UK wine brokers/merchants.

Furthermore Ailyan believes that the tax bill will rise very substantially once HMRC completes it investigation into the tax affairs of Bordeaux UK Ltd and Vanderhook. Listed at £63,720 it may rise to £500,000 and even over £1 million if HMRC applies penalties, although apparently in cases where members of the public are involved HMRC may well be waived.

Vin Bordelais Ltd – changes logo and phone but has it changed its spots?

2011-11-12T14:28:00.000Z

Vin Bordelais Ltd: website as of Tuesday 8th November 2011

Compare and contrast:

On Tuesday I posted about the Bordeaux UK trio – the three interlinked companies. Anyone visiting the Vin Bordelais site will find that there have been a few rapid changes: the logo, which was identical to that of Bordeaux UK has gone, and the phone number has changed from 0800-085448 (same as Bordeaux UK Ltd) to 01737-735290. '01737' is the area code for Reigate and Castle Court, 41 London Road, Reigate. This is a Regus serviced office building.

Despite these cosmetic changes, this is surely a wine investment company to avoid.

Vin Bordelais Ltd: website as of Saturday 12th November 2011

Blue Chip Fine Wines (Axetrader Ltd) dissolved

2011-11-11T17:56:00.002Z

Following the news that Bordeaux UK is going into voluntary liquidation, there is news that another wine investment company, Blue Chip Fine Wines (the trading name of Axetrader Ltd) has been dissolved. A first gazette was issued in early August 2011 and the company has now been struck off and dissolved. It was struck off for non-compliance – failure to file the annual return which was due on 29th April 2011. Axetrader's director was Dhugal Robertson of Sevenoaks, Kent, who set up Axetrader Ltd was working for European Fine Wines, which is based in Bromley.

I have been contacted by one client of the company, who has been waiting for several months for his wine to be transferred into his account at Locke-King Vaults (part of EHD Bond). Apart from providing secure storage under bond EHD has no connection with Axetrader. At present it not known whether the non-appearance of this customer's wine is an isolated example or whether there are other clients of Blue Chip Fine Wines who have not received their wines. Earlier on this year it took several months to transfer a case of Lafite-Rothschild into a customer's account.

Radio 4's Money Box want to hear from clients of Vine Capital and Vinance

2011-11-11T12:03:00.002Z

Posted on behalf of the BBC:

'Radio 4's Money Box is interested in hearing the experience of customers who have dealt with the wine investment firms Vine Capital and Vinance.

If you have feedback you would like to give the programme please contact Bob Howard on 0208 752 5828 or bob.howard@bbc.co.uk.'

WSTA (Wine & Spirit Trade Association) launches wine investment guide

2011-11-11T08:26:00.000Z

WSTA launches new wine investment guide

The WSTA has launched a guide to help the growing number of consumers who are investing in fine wine, either as collectors or as part of an investment portfolio. The guide aims to help wine buyers make the right checks before they part with their money.

Recent years have seen a growth in fine wine purchase but the potentially attractive returns have also sadly attracted some fraudsters, particularly in relation to en primeur - wines available for purchase prior to bottling and release onto the market.

The WSTA guide, available online at http://www.investinginfinewines.co.uk/, provides tips to help consumers ensure they don't become victims of fraud. They include:

"    Choose a reputable wine merchant, checking their trading history, track record and address
"    Verify your order by comparing prices, checking provenance, condition of storage, packaging and delivery. Remember, reliable en primeur traders don't sell before producers have announced their prices
"    Look after your investment, ensuring wine is securely stored in the right conditions and fully covered by insurance
"    Understand the small print, including tax on investment, commission and handling fees and the paperwork you'll receive covering your purchase

The WSTA cautions consumers to be wary of any businesses using hard-sell tactics such as offering guaranteed profits or fast returns. Fine wine should be seen as a medium to long term investment and as with all investments the value can go down as well as up.

Anyone who thinks they may have been a victim of fraud when buying fine wine should contact the WSTA Fraud Prevention Unit fraudalert@wsta.co.uk or report it to Action Fraud http://www.actionfraud.org.uk/report_fraud.

WSTA Chief Executive Jeremy Beadles said:

"Buying fine wine is a pleasure and can be a profitable one but as with any type of investment it makes sense to take some precautions before you part with your cash.

"Our website guide provides some simple tips to follow to ensure you don't get caught out. Making some basic checks about the company you're dealing with and its track record is a good place to start."

Bordeaux UK Ltd: curioser & curioser – a tale of three companies

2011-11-08T00:20:00.013Z

This morning when I posted the news that Bordeaux UK Ltd had gone into liquidation it all looked relatively straightforward. However, during the day complications have emerged: there are three companies involved not just one.

These are: Bordeaux UK Ltd, NS & IV Ltd and Vin Bordelais Ltd

Bordeaux UK Ltd (2002 version) – Companies House record

Bordeaux UK Ltd (company number – 04540202) founded on 19th September 2002. Registered office: Crown House, 72 Hammersmith Road, Hammersmith, London W14 8TH. 32-year-old Ian Van Der Hook is the director.

This is the original company and the one that has been placed in voluntary liquidation. On the 7th October the company changed its name to NS & IV Ltd and then on 26th October changed it back to Bordeaux UK Ltd.

Although the total deficiency is not known, it is already clear that a number of clients placed orders for en primeur Bordeaux from the 2009 and 2010 vintages. The wine trade will start to ship the 2009s from the end of this year with the majority being delivered in the first half of 2012.

Having spoken this afternoon to the liquidator, Nedim Ailyan (Abbott Fielding), the news on the en primeurs appears to be rather more postive than initially feared. Ailyan has been in contact with Octavian Vaults as well a merchants and brokers such as Farr Vintners, Wilkinson and Bordeaux Index and from replies so far received it appears that Bordeaux UK did place en primeur orders and had made payments. One unnamed broking company told him that of £135,000 ordered payments totalling £120,000. However, Octavian Vaults have been swamped with phone calls over the last two days, while Ailyan has taken over 100 calls. It is likely to take some time before it can be fully established whether what clients ordered to matches the orders placed by Bordeaux UK Ltd.

Regarding the estimated deficiency Ailyan believes that this may be less than £250,000 but obviously this could change once all the figures are in. "We were approached some six or eight weeks ago when initially the idea was to go for a solvent liquidation (Members' Voluntary Liquidation) but the continuing fall in the value of top wines made the company insolvent on paper."

NS & IV Ltd

NS & IV Ltd (co number: 07496940)

Company founded on 18th January 2011 with the same registered office address as Bordeaux UK Ltd – Crown House, 72 Hammersmith Road, London W14 8TH – a Regus serviced office. On 7th October 2011 the company's name was changed from NS & IV Ltd to Bordeaux UK Ltd. The name was changed back to NS & IV Ltd on 26th October 2011. Ian Van Der Hook is also director of this company.

Vin Bordelais Ltd

Vin Bordelais Ltd (company number: 07620869)

Company founded on 4th May 2011 with a registered office at 44a The Green, Warlingham, Surrey CR6 9NA. This address is one made available to companies as a registered office made available to companies by the Registered Office Service based at Regent House, 316 Beulah Hill, London SE19 3HF. Laurence Douglas Adams is the sole director of this company. He holds 3301 directorships. Vin Bordelais Ltd has an account at Octavian Vaults. Vin Bordelais Ltd's trading address is Castle Court, 41 London Road, Reigate RH2 9RJ.

It is instructive to compare the websites of Bordeaux UK Ltd and Vin Bordelais Ltd. It is noticeable that the logo is identical as is the telephone number – 0800-0854468.

Staff, who previously worked for Bordeaux UK Ltd, have contacted Octavian Vaults on behalf of Vin Bordelais Ltd saying that they have an interest in acquiring the stock held in the name of Bordeaux UK Ltd. Once appointed it will be one of the tasks of the liquidator to either dispose of the Bordeaux UK stock or allocate where title can be established to customers of Bordeaux UK Ltd.

Bordeaux UK Ltd website: front page (above)

Bordeaux UK Ltd: 'about us' page

Vin Bordelais Ltd: web page – same logo and phone number as Bordeaux UK Ltd

Updated@16.30 8.11.11.

Bordeaux UK placed in voluntary liquidation

2011-11-07T11:25:00.008Z

URGENT

Bordeaux UK have placed themselves in Voluntary Liquidation and have not filed accounts are about to be struck off. The company was founded on 19th September 2002. Accounts are overdue since 30.6.2011 and the annual return since 17.10.2011. Companies House issued the first gazette on 4th October 2011. The company changed its name to NS & IV Ltd on 7th October 2011. Ian Paul Van Der Hook is the company's director.

The proposed administrators are Abbott Fielding in Sidcup:

16 Hatherley Road

Sidcup

Kent

DA14 4BG.

Contact: Nedim Ailyan (insolvency practitioner)

Telephone: 020-8302 4344

E-mail: info@abbottfielding.co.uk

The meeting to appoint the administrators will be on 16th November at the Marriott Hotel in Bexleyheath, Kent at 11am.

Bordeaux UK used Octavian Vaults, one of the UK's leading bonded warehouses and entirely independent of Bordeaux UK Ltd. Octavian has been advised to refer callers to Abboot Fielding.

It is not known what the deficiency is nor whether they are wines that haven't been delivered to clients' private. If there are wines outstanding these are likely to include Bordeaux en primeur particularly from the 2009 vintage – hailed as a great vintage. In addition private clients may find that they will have to pay for their storage at Octavian even though they may have been told that Bordeaux UK Ltd would be paying for the first five years.

Warning to clients of Bordeaux UK Ltd

Watch out for the White Knights – other wine investment companies phoning you offering to help you out – get your wine or money back. Avoid at all costs – this is a classic wallet-thinning operation.

My thanks to anon for alerting me to this.

More details will be posted if and when I have them.

Moncharm Ltd: money hungry young fine wine brokers wanted

2011-10-31T10:58:00.000Z

From: junior-broker.com

Brokers Wanted for The Fine Wine Market

Job ID: 48649

Job Views: 1234

Location: Bromley,*

United Kingdom

Zip / Post Code:

Job Category: Alternative

Role: Broking

Employment Type: Full-time

Salary: incl Commission: £50,000.00 per year

Posted: 25/10/2011

Job Description

The Fine Wine Market

The Safe Haven for 2011

Do you enjoy the finer things in life?

Are you money hungry?

Then look no further.

We're an established Fine Wine Brokerage that are looking for money hungry young individuals that are willing to learn and be apart of a successful company.

We will provide full in-house training on the product and in sales.

All we asked for is for you to be energetic, enthusiastic and hungry for the finer things. You do not need to know the ins and outs of the Fine Wine Market. (Bold added.)

Please Contact Guy on 020-7959-2261 for an interview or altenatively please send your CV to info@moncharm.co.uk

Moncharm Ltd
68 King William Street
London, (United Kingdom)

Phone: 0207 959 2261
Web: www.moncharm.co.uk

Languages

Language: English

Fluency: Fluent

http://junior-broker.com/display-job/48649/Brokers-Wanted-for-The-Fine-Wine-Market.html?searchId=1320052718.0568&page=1

* Job is in Bromley but firm's address is at 68 King William Street, London EC4N 7DZ – a serviced office block.

Wine fraud on the rise in Hong Kong

2011-10-28T09:50:00.001+01:00

Article from The Drinks Business:

Hong Kong’s booming wine sector has led to a surge in illegal wine activities, from wine theft to investment frauds, writes Jessica Lam Hill Young.

Local media recently reported the largest wine fraud scheme in Hong Kong this June, involving a wine broker company called Premium Liquid Assets, which swindled over 400 people out of HKD$50 million by advertising a 10-30% investment return on en primeur wine.

Click on Drink Business above to read the rest.

See also earlier post on investdrinks here.

Sentences in bio-diesel investment fraud total almost forty years

2011-10-08T20:41:00.000+01:00

Not wine investment but an example of a boiler room fraud using cold calling and high pressure sales techniques.

4 October 2011

Seven men, who collaborated in a Spanish based boiler- room operation, were sentenced at Ipswich Crown Court today to a total of 39 and a half years’ imprisonment for conducting an £8 million investment fraud. Following a trial, six defendants were convicted by the jury on the 12 September. Another pleaded guilty on 6 June at the start of the trial.

This case involved the selling of shares in bio-diesel company Worldwide Bio Refineries Ltd (WBR). Further background on the case was available in the conviction press release issued on the 12th September.

SFO reaction

Commenting on the convictions SFO Director Richard Alderman said, “I am very pleased with the sentences in this case which reflect the callous way the criminals preyed on their victims.”

Sentences

Dennis Potter of Singapore (DOB 02/04/39) and Redmond “Ray” Charles Johnson of Tyne and Wear (DOB 19/09/44) were the directors of WBR.

Potter was sentenced to seven years’ imprisonment.
Johnson who pleaded guilty under a SOCPA arrangement, (see note 3 for details) was sentenced to three years’ imprisonment.

In addition, Potter and Johnson were disqualified from acting as company directors for 12 years,’’

The remaining five defendants were boiler room operatives and their sentences were as follow:

From Marbella :-

Steven John Murphy (DOB 13/02/76) was sentenced to six years’ imprisonment.
Greg Pearson (DOB 26/08/73) was sentenced to six years’ imprisonment.

From Hertfordshire:-

Paul Daniel Murphy (DOB 28/09/73) was sentenced to six years’ imprisonment.
Lee Eliot Homan (DOB 02/07/72) was sentenced to five years’’ and six months imprisonment.

From London :-

Peter Bibby (DOB 01/09/67) of south London absconded and was tried and sentenced in absentia to six years’’ imprisonment. There is a court issued warrant for his arrest.

All of the five boiler room operatives were also disqualified from being company directors for six years.

In passing sentence, HHJ Overbury said of the fraud “This was a well planned, sophisticated, and well executed fraud dressed up in the language of legitimate business. It involved deliberate targeting of a particular group of investors. The Directors actions amount to a breach of trust of the investors. They had a long lasting effect on the victims who lost their savings.”

On the prosecution case, the judge said, “This was a complex investigation carried out with the utmost professionalism by the SRB [case team] SFO and the Norfolk and Suffolk Constabulary. All those involved in the investigation are to be commended for their hard work and professionalism.”

This case was prosecuted by the Serious Fraud office in conjunction with Norfolk and Suffolk Constabularies. Confiscation proceedings will take place at court on a date to be fixed.

Notes for editors:

Fine wine prices falter in August

2011-09-06T07:53:00.003+01:00

Start of a trend or a temporary blip? This is the first significant downturn since the latest steady growth curve started in January 2009.

From the Liv-ex blog:

'Lafite: The force behind last month's losses

The Liv-ex Fine Wine 100 Index lost four per cent in August - its third-most dramatic monthly fall since its inception in 2001. Though the majority of index constituents performed poorly - most notably the First Growths - the real millstone was Lafite Rothschild.

Read the rest of the post here.

See also brief article in the FT

Some analysis in Harpers here.

Cold calls: excellent advice from Tony Levene (lovemoney.com)

2011-08-28T09:55:00.000+01:00

'Never, never, ever respond to anyone who phones you with an investment proposition of any sort.

It does not matter what they say! Real financial advisers do not and are not allowed to do this.

Now, if everyone were to remember that, then no one would lose a penny to fraudsters like the Wilmots.'

From an article on the busting of UK's biggest boiler room scam.

Vintage Hallmark plc: mixed success for the SFO

2011-08-19T08:16:00.000+01:00

The long running series of trials into Vintage Hallmark/ Hallmark Partnership, the largest drinks UK drinks investment scam came to an end this week at Harrow Crown Court. There have been reporting restrictions on some of these cases.

The fraud involved initially persuading American and Canadian clients, mainly from the medical profession, to invest in a range of over-priced alcoholic drinks, including whisky, Cognac, Champagne and wine. The Hallmark Partnership started their sales drive in 1995 and was run by David Lamb, Richard Gunter and Robin Grove. In November 2000 it was 'acquired' by Vintage Hallmark plc. The clients of The Hallmark Partnership were persuaded to swop their investments for equity in Vintage Hallmark plc, who had imposing offices at 36 St James's Street, one of London's most exclusive streets.

Equity in Vintage Hallmark plc turned out to be worthless when the company collapsed in January 2003 owing just under £80 million, which led to an investigation by the SFO (The Serious Fraud Office)

The trials

Vintage Wines of St Albans (company linked to Vintage Hallmark/ Hallmark Partnership)

The first trial involved Richard Gunter and three employees. All were found guilty in September 2008 and Richard Gunter was sentenced to four and half years for fraud. Those convicted included Haroon Khatab, who was later found guilty of another fraud involving Tahir Tandoori Frozen Foods Limited. Khatab was sentenced to two and a half years imprisonment for his part in Vintage Wines of St Albans and he received nine months for his part in the tandoori fraud.

Vintage Hallmark plc

On 1st June 2010 Richard Gunter pleaded guilty to this fraud and was sentenced to five years and is subject to a Serious Crime Prevention Order.

Robin Grove, a fellow director, was acquitted of one count of false accounting, while the jury were unable to come to an agreed decision on charges of conspiracy to defraud. The trial had started in June 2011 and finished at the end of July. The SFO and The Crown have decided against seeking a retrial.

Disqualified as directors

In December 2006 Richard Gunter and Robin Grove were banned from being UK directors for 15 years for their part in this investment fraud. The disqualification will run until December 2021. Gunter is prohibited from carrying out investment business in the UK.

Their business partner, David Lamb, committed suicide on 1st November 2003.

For further details see here.

Bordeaux Wine Trading Company highlights dangers of buying en primeur

2011-07-15T13:11:00.004+01:00

One very obvious lesson from the convictions in the Bordeaux Wine Trading Company Ltd and International Wine Commodities Ltd is how ideally suited en primeur is to fraud. It is indeed a gold plated vehicle for fraud. Had Craven and Hayble been really clever rather than merely greedy, particularly Craven, they could well have covered their tracks and disappeared with a substantial portion of the £1.2 million looted from investors.

Curiously only this week I received a query from a potential investor (TG) who had been contacted by Worldwide Wine Investments Ltd (WWI), who are based at Luminous House, 300 South Row Milton Keynes, MK9 2FR. Although set up in March 2007 the company traded as Clearpoint Trading until 15th October 2010, when it changed its name to Worldwide Wine Investments Ltd. The registered office was also changed from 145-157 St John Street, London EC1V 4PY.

From the company's website it is clear that they have made rapid progress since October 2010 – 'we are a unique high-end wine investment brokerage specialising solely on the crême de la crême Bordeaux wines making you the best returns possible'.

TG explained that Worldwide Wine Investments had offered him: 'Lafite Rothschild 2010 @ £11,500 per case (9ltrs), Mouton Rothschild 2010 @ £7,400 per case (9ltrs). Prices include all taxes and import to the warehouse.

They take 5% of profit on resale.

Sounds very reasonable?'

My response to TG:

'If you look at wine-searcher you will see that Worldwide Wine Investments price for the 2010 Lafite-Rothschild (WS: £11675) is lower than any price shown. Similarly with the Mouton 2010 (WS: £7639).

Although it may look reasonable and a good deal, you might wonder how a newly set up company is able to offer lower prices than its competitors given that it is highly unlikely that it will have been able to buy direct from Bordeaux. Instead will have had to buy from its UK competitors.'

TG told me that the sales staff had told him that they had between 160 and 210 cases of 2010 Lafite. I assume this must have been said in jest as even a major player like Berry Bros & Rudd are thought have had only around some 200 cases of 2010 Lafite to offer to their customers this year en primeur. The amount of 2010 en primeur wine the First Growths have released this campaign is significantly less – probably the smallest ever.

The WWI claims 'Bordeaux Vintage Wine, The 100% Tax Free Tangible Asset'. Not sure that HMRC would agree!

•

I have emailed Geraint Jones, a director of Worldwide Wine Investments Ltd, inviting him to comment.

Paul Craven and Andy Hayman: courtroom demeanour

2011-07-14T22:11:00.001+01:00

Watching the performance of Andy Hayman before the Parliamentary Select Committee this week I'm irresistably reminded of Paul Craven giving evidence at his recent trial at St Albans Crown Court.

See here and here.

BWTC and IWC: Craven and Hayble jailed

2011-07-14T14:35:00.004+01:00

Today at St Albans Crown Court Paul Craven was sentenced to six years for fraudulent trading in connection with the Bordeaux Wine Trading Company Ltd. Oseghale Hayble was sentenced to five years for the same offence for International Wine Commodities.

The maximum sentence is seven years for a single offence.

I understand that Craven wrote to His Honour Judge John Plumstead apologising for his stupidity but the Judge said it wasn't a question of Craven's stupidity rather that he was dishonest. Craven was principally to blame for setting up the fraud. The judge said that the jury's verdict was absolutely correct and that Craven had wasted people's time and money with his highly unlikely defence through two trials.

The judge would have likely to give Craven a longer sentence but his hands were tied with seven years being the maximum.

There will now be proceedings to confiscate the fraudsters' assets.

The investigation was carried out by the Economic Crime Unit of Hertfordshire Police.

Bordeaux Wine Trading Company: Paul Craven looted investors' money

2011-07-13T02:56:00.003+01:00

There are a number of reasons why I'm delighted that Paul Craven, 'managing director' of the Bordeaux Wine Trading Company Ltd (BWTC) was found guilty of fraudulent trading on Monday at the second time of asking.

The guilty verdict shows that you can't just take investors' money on the pretence that you are buying Bordeaux en primeur, and instead blow it on a succession of cars, expensive watches, almost continuous holidays, a flat and £100 a week cocaine habit.

During his evidence Craven said he was proud to be 'managing director' of a company that was doing well. In reality Craven was the looter in chief – very far from the 'managing director'. Ann Evans, the Crown Prosecutor was right when she told Craven – "You treated BWTC as your own private piggy bank".

I'm delighted because it underlines that a jury often comes to the right decision in drinks investment trials. At the end of the first trial last autumn the jury couldn't decide whether Craven and Oseghale Hayble were guilty in relation to BWTC, so there had to be a retrial. As previously reported Hayble became ill during the trial, so Craven was left as the sole defendant. I suspect that at the first trial the jury, faced with a number of defendants and three different companies – BWTC, International Wine Commodities and Templar Vintners, they felt they couldn't safely convict Craven for his part in BWTC.

Happily this time it was different. In the full glare Craven's threadbare defence was evident. It was not in dispute that the company had never bought any wine for its investor clients. Instead Craven claimed that it was Hayble, who had been responsible for buying the wine. He maintained that he assumed that Hayble was buying wine. Craven, the sole signatory on the bank account for much of BWTC's fraudulent life, claimed he had taken Hayble's word as his bond as he passed over wads of cash in brown envelopes to Hayble. Laughably Craven explained that Hayble had told him that if he paid for the wine in cash they would get a 50%-60% discount of the First Growths they were selling to their clients.

Craven claimed that he was still passing great wads of cash over to Hayble even after Hayble had left to set up the equally fraudulent International Wine Commodities Ltd. On one occasion £85,000 was "handed over" in the car park of the Maze Inn in North London. Curiously Craven never thought to ask for a receipt for any of this cash. Nor did he appear to think it curious that there were no receipts for wine bought, although the company did keep records of invoices and bills for office furniture, computers and the like. Furthermore Craven acknowledged that one of his few tasks at the company was to check the bills. No receipts for the £1.2 million taken from BWTC's clients to buy investment wines? "I trusted Hayble – took his word as his bond," said Craven.

Yet at the same time Craven claimed in the witness box that Hayble was spending a lot of time in night clubs – drinking heavily and snorting cocaine. No receipts for the cash handed over! Flying pigs territory! The simple answer was it was never Craven's intention to buy any wine. From his very short time as a salesman at the Bordeaux Wine Company Craven had learned that there is easy money to be made in flogging wine as an investment to naive punters. Even easier, if as was the case with BWTC, you simply trouser your clients' cash.

It is clear from the unanimous guilty verdict that Craven gained no friends from his egotistical display in the witness box. Although he mouthed some platitude about having "a duty of care to BWTC investors to ensure that their wine was bought", Craven couldn't have cared less about the clients he had fleeced to provide him with coke, flashy cars, smart clothes, designer watches etc. The only person he felt sorry for was – Paul Craven – the last defendant and in prison on remand. "I've been left to carry the can!" he bleated.

Testimony from the sales force painted Craven as a bully who could be charming when he wanted to be but was unpredictable. Craven insisted that his boiler room sales team pounded the phones incessantly – not as it turned out because of a work ethic but to pour more cash into his pockets. "It was sometimes difficult to even get a coffee," said one of the salesmen.

At the autumn trial Hayble along with Benedict Moruthoane were found guilty for their part in the International Wine Commodities fraud and, in addition, Moruthoane for the Templar Vintners fraud. On 5th January 2011 Moruthoane was sentenced to 7.5 years, which is a considerable sentence for fraud.

On Thursday it will be the turn of Paul Craven and Oseghale Hayble – I hope they, too, get substantial sentences.

Finally I'm delighted that Hertfordshire police's economic crime unit carried out the investigation and obtained these convictions.

***

It was extraordinary to watch convicted fraudster, Frederick Achom, give evidence that he is a partner in the Bordeaux Wine Company Ltd, a wine investment company set up in 2002 by Achom and his fellow fraudster – Anthony Grant. Both men were banned in 2002 from being directors for 11 years until July 2013. Yet here they are running a wine investment company as shadow directors. Achom testified that up until 2006 was he was in charge of buying the wine, while from other testimony given during the trial it is clear that Anthony Grant is fully involved in the day to day running of the company, particularly in managing and training the sales staff.

Why one might wonder bother to ban people from being directors if you are not going to enforce these bans?

Bordeaux Wine Trading Company: Craven guilty

2011-07-12T23:09:00.001+01:00

The jury in the Paul Craven case returned a unanimous verdict of guilty yesterday – found guilty of fraudulent trading.

More to follow.

The Bordeaux Wine Trading Company: fraud trial 30th June - 1st July 2011

2011-07-03T10:36:00.010+01:00

Thursday St Albans: 30^th June 2011 and 1st July 2011

Defendants: Paul Craven

Charges:

Fraudulent trading

Between 21^st July 2006 and 19 June 2008 knowingly party to the carrying on a business of a company Bordeaux Wine Trading Company with the intent to defraud the creditors of said company, BWTC took £1.2 million from its clients. Only £12,200 has been recovered.

It is accepted that the Bordeaux Wine Trading Company Ltd bought none of the wine (all en primeur) that their clients ordered.

Samantha Cohen, Craven's defence barrister, took Craven through his evidence starting with his time with Bordeaux Wine Trading and, in particular, his admiration for Freddy Achom's life style. Craven saw Achom a couple of times flying past in a Ferrari and a Lamborghini along with tales of weekends in Monte Carlo and Cannes. Craven agreed that he thought "I wouldn't mind a bit of that lifestyle myself".

In the summer of 2006 Craven said he asked Nik Cashman if he fancied setting up a similar business to BWC? Cashman readily agreed on the condition that we can get Oseghale Hayble on board. The spark to set up BWTC had come from Paul Craven. However, he said that "I didn't have a clue about what we were doing. At this point I had only had 4-6 weeks experience in wine investment, whereas Nik had had one year and Oseghale had several years' experience".

Craven said that he had a meeting with Hayble to sound him out in an All Bar One at Oxford Circus. Hayble agreed to join them if "I can purchase the wine". Craven explained how they set up the company and Ms Cohen took him through a number of invoices and bills for office furniture, computers, the Goldmaine program and the like. Craven was the sole signatory on the bank account. Checking bills was part of Craven's management role.

Hayble persuaded a number of sales staff to come across from the Bordeaux Wine Company. Niklaus Cashman and Hayble did the job interviews. "I didn't know what was needed to be a good salesman," said Craven.

The content for BWTC brochure and website was copied from the Bordeaux Wine Company. "It was put together by Nik and Ose. I had no substantial input, although I did read it through."

"Ose was always meant to purchase the wines. I couldn't even pronounce the châteaux's names for the first six months. I didn't have one contact in the wine trade. Ose told me that he was dealing with Bud Cuchet, buying director of Fine & Rare Wines Ltd." Craven was shown an email sent on 9th February 2007 from Cuchet enclosing a list of 'what we can offer'. Craven didn't think he had seen this email.

(Although there was contact with Fine & Rare Ltd, a fine wine broking company established in 1994, no orders were placed or wine bought.)

It was Ose's signature on the certificates sent out to investors. Craven never sold a case of wine at BWTC. "I couldn't do it. Hours and hours of conversation on the phone. Let them get on with it really."

"Ose was meant to be dealing with the wines." It was Ose who decided what price to charge for the wines. "I wouldn't have known what price to charge," said Craven. "We gave Ose cash to purchase wine." Although Craven was the sole signatory on the bank account until September 2007 when Cashman became a signatory, the company debit card was for Hayble and Cashman's use. "The card was there to be used," said Craven.

On 3rd January 2007 Hayble and Craven became directors of the company. "I felt good about it – managing director of a company doing well. It was recognition."

Their secretary Lauren Reynolds was with the company for between 4-7 months. From time to time she would be kicked out of the office. "It was so Ose and I could sort out the money and for general chat. We would be handling 10s of thousands of £s, so we didn't want her to see this."

Ms Cohen asked Craven why they had paid for the wine in cash. "Ose told me that if we paid in cash then we would get a 50-60% discount for cash. Ose put us all in the shit because he didn't buy the wine – I wouldn't have known that he wasn't buying it."

Craven described how Hayble was given wads of money – £85,000 in one instance – in brown envelopes. "We were buying wines en primeur – wines that would not be delivered for 18 months to two years." Craven explained that they had a computer program that would allow password protected access to the accounts from anywhere in the world.

In July 2007 Hayble resigned as a director of the Bordaux Wine Trading Company telling Craven that he wasleaving to set up a modelling agancy. Craven claimed that he and Hayble had "a firm agreement that Ose would continue to purchase wine – "he would take cash and purchase wine. This was what was supposed to be happening." Craven explained that he met Ose at various places. "We met at the Maze Inn – sometimes in the carpark and sometimes inside. Ose, who could log in to see what had been sold, was always given the money in cash to purchase wine," insisted Craven.

More to follow.

The Bordeaux Wine Trading Company: fraud trial 20th June 2011

2011-07-01T08:14:00.007+01:00

St Albans: Monday 20^th June 2011

Defendants: Paul Craven and Oseghale Hayble*

Charges:

Fraudulent trading

Between 21^st July 2006 and 19 June 2008 knowingly party to the carrying on a business of a company Bordeaux Wine Trading Company with the intent to defraud the creditors of said company.

It is accepted that the Bordeaux Wine Trading Company Ltd bought none of the wine (all en primeur) that their clients ordered.

Monday 20^th June 2011

Three witnesses: Stephen Creaton (salesman with Bordeaux Wine Trading Company), James Seaton (salesman with Bordeaux Wine Trading Company) and Frederick Achom (owner of the Bordeaux Wine Company).

Stephen Creaton

From April 2006 he had worked at the Bordeaux Wine Company, a wine investment company set up in 2002, where he had met Oseghale Hayble, who was his line manager. At BWC his role was to cold call from qualified leads. BWC sold First and Second Growth wines – both finished wines and en primeur. Anthony Grant was his manager with Hayble as his deputy.

After Hayble left BWC he contacted Creaton to offer him a job with the his new company – The Bordeaux Wine Trading Company (BWTC). He decided to accept as the pay was better with a more favourable commission structure and the offices in Potters Bar were closer to his home whereas BWC was based in Central London.

As at BWC the sales force at BWTC used Goldmine, a software progam to keep track of clients. The sales force used a script provided in a folder.

Hayble was again his line manager, who spent most of his time with the sales team. Creaton described Hayble as “very fair, generally a nice manager”. Paul Craven wasn’t in the office generally spending his time when he was there in the back office. “Craven was very insistent that the sales team should be on the phone – even getting a coffee was hard.”

There were two white boards in the sales room. One recorded the sales made by the staff. It was Hayble, who kept this board up to date. The other board listed the five First Growths and their prices. The list of wines never changed, although the prices did. There was no indication of the quantity of wines available and it was Craven who changed the prices. Samantha Cohen, Craven’s barrister, challenged Creaton whether he was correct to say that it was Craven who updated the prices. Although pressed on this, Creaton maintained that it was Craven who updated the prices.

In time Creaton become concerned about BWTC and whether the wines were being bought. As he came to learn more about the fine wine market an off-the-cuff remark by Craven that he was off to Bordeaux to buy wine was a catalyst for his concerns

In time Creaton stopped selling and started to look for a new job. He was asked about the cars that Paul Craven drove and mentioned that Craven had a series of one car after another. This included a black Porsche, Golf and a motorbike – £10,000 new bike.

James Seaton

Seaton was another salesman at the Bordeaux Wine Company Ltd where he spent about 18 months. He was trained by Hayble and met Paul Craven at BWC. His role there was to cold call potential clients and to follow up calls.

In January 2007 he was contacted by Craven, who told him that he could earn better money. He accepted and started work at BWTC’s office in Potters’ Bar in February 2007. His day-to-day contact was with Hayble.

Initially working at BWTC went OK but as time went on it became more and more chaotic, especially once Hayble left in ‘September-October 2007. “Nothing organized.”

Seaton was asked about the two white boards. One had targets and amounts of wine that had been sold by the sales team. The other listed the prices of the wines to be sold. He didn’t know how much wine there was to sell.

Seaton had no contract of employment with BWTC. By January 2008 the company was disorganised “It was a chaotic place to work.”

Cross examined by John Femi-Ola, Hayble’s barrister, Seaton said that Hayble drove a black Honda, while Craven was “living it large’. Seaton listed the cars that Craven drove: a Range Rover, black Porsche, sports motorbike, a BMW convertible and a Golf Sports. “But not all at the same time,” Seaton added.

Seaton explained that from time to time Paul would offer special one-off-commission deals on wines – known as spivs. These were offered “apparently at Paul’s whim. Ose was much easier to deal with. Appeared to me that Paul was a law to himself.”

From August 2007 after Hayble had left “the business went down the drain. The admin collapsed. The secretary left and wasn’t replaced. The office was manic and chaotic. Craven was in the office less and less. Sarah, Paul’s partner, would come in from time to time.”

Seaton was asked by Femi-Ola, who he thought was responsible for buying the wine in the period from August 2007 to January 2008 after the departure of Hayble. Seaton wasn’t aware of who was responsible for buying the wine. His Honor Judge Plumstead listed for Seaton the people who had left the company and the person still at the company – Paul Craven.

Frederick Achom

Partner in the Bordeaux Wine Company

Frederick Achom is a partner in the Bordeaux Wine Company Ltd (BWC), a wine investment company established in 2002. Craven and Hayble worked for BWC prior to setting up BWTC. Achom explained that the company offers both bottled wines and en primeur. They purchase from UK based merchants – top wine merchants – as well as from France and Switzerland and négociants in Bordeaux. He described BWC’s invoice to customer system for en primeur including an allocation confirmation certificate, showing who they had bought the wine from. In 2006 he had a 12-15 strong sales force and the company was turning over £3.5 million. The sales’ staff were paid a basic wage of £25,000 with between 2%-4% commission.

Up to 2006 it was Achom who bought wine – now it is Arlene King.

Achom explained that their margins were “way higher when they started” and that they were “slightly over-priced”. He said that the 2005 vintage was the beginning of the boom and that certain wines were increasing in price by 30% a year. 2000 Lafite had gone from £3000 to nearly £20,000.

Hayble worked for BWC off and on for a number of years. His periods of work at BWC would be interspersed by his time modelling and acting. In all he probably worked seriously for BWC for 18 months. Achom was aware that Paul Craven had worked briefly for BWC but he had never met him.

Achom was asked by prosecutor Ann Evans whether he was aware that he was a hero to Paul Craven. “He looked up to you. Your success – your cars: Lamborghini etc.” Achom was not aware that Craven took him for a role model.

In June 2006 Hayble told Achom over lunch that he was going to Los Angeles to see if he could make a real go of his acting career. However, later Achom learnt when he started receiving phone calls from BWC clients, who had been contacted by BWTC, that Hayble had actually set a rival wine investment company with Paul Craven. “When we checked the prices BWTC were offering on wine-searcher, they were way too low,” said Achom. BWTC were selling below the market price.

Achom was asked about a phone call he made to Hayble in October 2008, after Hayble had gone on to set up International Wine Commodities Ltd, challenging him saying “Up to your old frauds again!”

Achom was also asked about how companies pay for the wine they order. “We pay by bank transfer or by cheque. The idea of paying for wine using bundles of cash in brown envelopes is a nonsense.” Craven would claim repeatedly when he gave evidence this week (30^th June – 1^st July) that it was Hayble’s responsibility to buy the wine and that he was given money in brown envelopes for this purpose.

* Later in this week Hayble became ill and proceedings against him were halted with the jury discharged from considering his case. Craven is now the sole defendant in this trial. A report on his time in the witness box will be added shortly.

Wine Investment Code – guide to best practice

2011-06-27T14:35:00.000+01:00

Very useful meeting at the WSTA (Wine & Spirit Trade Association) offices this morning to discuss the proposed 'code'.

It was agreed that as the code is now designed to provide guidance on both best practice and what to avoid that it will become a guide to wine investment – on how companies should treat investors both potential and actual.

The next step is that the WSTA will redraft it as guidance and then it will go out for comment – a process that I hope will not take long.

CBV Vintners: 2010 Lafite offered before release

2011-06-26T14:50:00.002+01:00

The ability to look into the future is a most useful skill as this email (15th June 2010) from Stephen Miles of CB Vintners shows. 11 days after Stephen Miles sent his email (26th June 2011) Lafite has yet to release its price for the 2010. It is also not know how much will be released.

If I was the recipient of this email I would decline Mr Miles' kind proposal despite his apparent ability to purchase 'the best and most sought after stock'.

From: Stephen Miles
To: ***
Sent: Wed, June 15, 2011 5:13:55 PM
Subject: Your request for further information on fine wine investment

Dear •••

I hope that you are keeping well.

You recently requested some information on wine investment opportunities. Please see below our latest offer.

The 2010 Bordeaux vintage is in the process of being released at the en-primeur stage. The 2010 vintage is set to be one of the top 5 vintages of all time. The demands from all over the world and especially China are far exceeding the supply. In the last couple of years we have seen astronomical returns in a short period of time. In fact as an example from the spring of 2009 to date Lafite Rothschild 2008 has increased by 700%...I know amazing. The Chinese cannot get enough of this wine. As I have been operating within the market place now for 15 years, I am in a favourable position when it comes to purchasing the best and most sought after stock.

At this stage, I would like to offer you the opportunity to purchase up to 3 cases of the superb 2010 Lafite Rothschild. The price of each case will be £12,500. I believe that this wine – the most sought after wine in the world has the capability to double in value over the next year to 18 months if we observe the performance of previous vintage

I would recommend that you take advantage of the proposal that I am offering you.

I look forward to any questions that you may have. Please email me.

Kind Regards

Stephen

Robin Grove (Vintage Hallmark) fraud trial@Harrow

2011-06-25T10:24:00.000+01:00

Robin Grove, a director of Vintage Hallmark Ltd, is currently on trial at Harrow Crown Court in North London on 5 counts: two counts of conspiracy to defraud, two counts of fraudulent trading and one of concealing material facts. The charges relate to Vintage Hallmark Ltd, Vintage Hallmark plc and to The Hallmark Partnership.

Vintage Hallmark Ltd sold alcoholic drinks (wines and spirits) as investments to American investors (mainly in the medical profession). Later they were induced to swop their 'investments' for shares in Vintage Hallmark plc, which went bust on 22nd January 2003 owing just short of £80m (US$128m – $158 million at the time).

The case has been brought by the Serious Fraud Office. The trial started on 31st May and is expected to conclude in early July.

Warning from FSA about unauthorised investments

2011-06-23T16:00:00.001+01:00

Interesting article in City Wire here.

Harassment, privacy, press freedom and Stephen Cleeve

2011-06-21T11:22:00.002+01:00

Last Friday Ian Puddick was cleared at Westminster Crown Court of harassment. Puddick (what a wonderfully English name!) had publicised his wife’s affair with her millionaire boss, Timothy Haynes, on the net using a cocktail of blogs, twitter, facebook etc. It was reported that the judge ruled Puddick's actions did not form a "course of conduct" and dismissed the charges.

This case follows on from several weeks of high excitement in the British press over injunctions and superinjunctions gagging the press from reporting on football stars, who have been playing away from home with a bevy of usually generously structured starlets, as well as the head of one of the UK’s biggest bank, who had an affair with a colleague while the bank went into meltdown in 2008. A so-called superinjunction is so secret that there is a ban on even reporting on its existence. I have little doubt that these superinjunctions were first devised by F. Kafka.

Puddick’s case, which will have helped to define the limits of the 1997 Harrassment Act had a particular resonance with me as back in March of this year I received threats from a firm of media lawyers that if I continued to cover the activities of their client, Stephen James Cleeve I was likely to find myself before the High Court for harassment.

I have been writing about/ covering the activities of Mr Cleeve since 1996. Over the years he has sold a succession of dead duck investments starting with barrels of whisky, followed by Champagne for the great millennium party and then it was onto plots of agricultural land that would magically be transformed into goldmines once they were given planning permission. Cleeve’s Champagne offer was partnered by the most hopeless of all drinks investments ever – pipes of ruby Port (the basic sort) – that he sold through his company Forrester & Lamego Ltd until it was closed in the public interest and Cleeve was banned from being a director from 2000 to 2008.

I still have a copy of promotional video put together by Cleeve and his associates for his land-banking venture – European Land Sales. Provided you were not one of the unfortunates that were persuaded to pay over the odds for plots of land that are all too likely to remain worthless, the video is hilarious. My favourite section is Cleeve talking about what happens if ELS doesn’t get planning permission. “ This is a situation where you have to look at our track record,” he explains. “Our track record shows that we do get planning in most of our cases. And, also if we have done our due diligence properly it is something that just does not occur.”

Cleeve was right to say “just does not occur” – in the sense that at the time the video was made ELS had not just never got planning permission for one of their agricultural sites, they had never even submitted one planning application. Just another of the lies Cleeve confessed to telling in an March 2011 interview with the Herald Sun: "No, no religion at all. To tell you the truth I just got sick of lying, and I had enough. I've gone straight." (http://www.heraldsun.com.au/business/barefoot-investor/confessions-of-an-accidental-conman/story-e6frfim6-1226020093601)

In March 2010 in the lead up to the May 2010 UK General Election Cleeve was chosen as the UKIP’s (UK Independence Party) candidate to fight the Kensington seat in west London. His candidature was short lived as he stood down by the end of March once details of his colourful career emerged.

Most recently Cleeve, a long-time football fan, has been trying to buy Wrexham Football Club. It was a post on my investdrinks blog in February that triggered a letter (3.3.11) from Cleeve’s solicitors’ PSB Law (www.psblaw.co.uk)

They claimed that my ‘recent and ongoing coverage amounts to a possible invasion of privacy and/or possible actionable harassment, in that it would be said to be a course of conduct causing unwarranted distress.

‘For this reason we must request your formal undertaking to cease and desist such coverage of Mr Cleeve’s activities, save to the extent that they concern (as they do not, have not since 1997, nor are expected to be in the future) current activity within the wine and spirits investment sector. We request that undertaking within 14 days. Furthermore we request that you remove the articles and publications, whether or not referred to above, concerning Mr Cleeve, save where they concern current activity within the wine and spirits investment sector. If this is not forthcoming, then proceedings may be commenced in the High Court without further notice to you.’

My response to PSB (14^th March 2011):

‘Response to your letters of 3^rd and 8^th March 2011

There has been no harassment of Stephen Cleeve. I refer you to the Court of Appeal - Iqbal v Dean Manson [2011] EWCA Civ 123 Section 34 paras 32-35 on page 12 of the judgment.

Your claim that I may have invaded Mr Cleeve’s privacy is absurd. I have not intruded into Mr Cleeve’s private life and never made any comment on his private life, which I have no knowledge of or interest in. I have only ever covered your client’s business activities and his public life, for instance as a UKIP parliamentary candidate and, more recently, as a prospective purchaser of Wrexham Football Club.

This grotesque attempt at gagging is an attack on my freedom of expression and contravenes my rights as enshrined in the 1998 Human Rights Act.

The information contained in my posts on Stephen Cleeve’s brief tenure as UKIP’s parliamentary candidate for Kensington at the 2010 General Election is all in the public domain and my comments are fair, reasonable and in the public interest. I note that you have made no complaint over the accuracy of these posts. Nevertheless I reiterate my invitation of 4^th March 2011 to let me know if there are any inaccuracies in them.’

Returning to the Puddick case there are three crucial paragraphs in the Court of Appeal judgment (Iqbal v Dean Manson ) above that supports press freedom:

[33] Prior to the 1997 Act, the freedom with which the press could publish facts or opinions about individuals was circumscribed by the law of defamation. Protection of reputation is a legitimate reason to restrict freedom of expression. Subject to the law of defamation, the press was entitled to publish an article, or series of articles, about an individual, notwithstanding that it could be foreseen that such conduct was likely to cause distress to the subject of the article.

[34] The 1997 Act has not rendered such conduct unlawful. In general, press criticism, even if robust, does not constitute unreasonable conduct and does not fall within the natural meaning of harassment. A pleading, which does no more than allege that the defendant has published a series of articles that have reasonably caused distress to an individual, will be susceptible to a strike-out on the ground that it discloses no arguable case of harassment.

[35] It is common ground between the parties to this appeal, and properly so, that before press publications are capable of constituting harassment, they must be attended by some exceptional circumstance which justifies sanctions and the restriction on the freedom of expression that they involve. It is also common ground that such circumstances will be rare.’

It would seem likely that this judgment will have informed the decision in the Puddick case. If the 1997 Protection from Harassment Act could be used to limit press freedom as demanded by Cleeve’s lawyers, then it would make investigative journalism in the UK even more difficult given our already fierce libel laws and the apparent ease that superinjunctions are granted by the courts.

Now that he has turned over a new leaf and ‘gone straight’ Stephen Cleeve has said that he is repaying A the end of March 2011 I addressed some questions to Cleeve through his lawyers. To date I have had no response to the following:

a) Did any of the sites promoted by European Land Sales (ELS) and Commercial Land ever get planning permission for building development? If so which sites were these?

b) Are there any sites where ELS/Commercial Land have to date not submitted any planning applications?

c) Has Stephen Cleeve ever managed any successful property development?

d) In an interview with Red Passion (12^th March) Stephen Cleeve explains that he “I am donating all of my retained land into a hardship fund to be used to help any investor who loses money from any of their dealings with me.” Does this fund have a name? Has it paid out any money to date? How much money does he estimate investors have lost through ELS and Commercial Land? How long will it take for these investors to be repaid?

Naturally I will publish any responses received to my questions from Stephen Cleeve or his lawyers.

Fraud trial@St Albans Crown Court – Bordeaux Wine Trading Company

2011-06-20T20:22:00.000+01:00

Château Lafite and other first growths: clients ordered, paid but company didn't place orders

Long day@St Albans Crown Court with three witnesses appearing on the third day of the trial of Paul Craven and Oseghale Hayble accused of fraudulent trading with respect to the Bordeaux Wine Trading Company. The crown prosecutor is Ann Evans, Samantha Cohen is defending Paul Craven and John Femi-Ola is the defence for Oseghale Hayble. His Honour Judge John Plumstead is hearing the case.

Among those giving evidence today was Frederick Achom, who testified that he was the owner of the Bordeaux Wine Company. The trial started last Thursday.

Letter from Liquid Assets Ltd about Premium Liquid Assets

2011-06-15T17:25:00.001+01:00

Letter of Declaration between Liquid Assets Ltd. and Premium Liquid Assets Ltd.	13 June, 2011

Letter of DeclarationLIQUID ASSETS and PREMIUM LIQUID ASSETS It has come to our attention that we, LIQUID ASSETS LIMITED, supplier of fine wines and beers from around the world, has been largely confused with the French wine wholesaler PREMIUM LIQUID ASSETS who are currently under investigation of a wine investment scam. Please be duly informed that LIQUID ASSETS LIMITED does not offer any wine investment service and is not engaged in any such activities. LIQUID ASSETS LIMITED and PREMIUM LIQUID ASSETS are wholly separate business entities and are not in any way affiliated or undergoing any business collaboration. Should you have any enquiries, please do not hesitate to contact us directly for verification and clarification. Yours Faithfully,Liquid Assets Limited (Liquid Assets Ltd is based in Hong Kong) From: http://www.liquidassets.com.hk/news/detail/LetterofDeclarationb/eng/ www.premiumliquidassets.com Report in Chinese on apparent problems with Premium Liquid Assets here.

A recent message about Worldwidewine Investments

2011-06-15T14:59:00.003+01:00

From: AD

Dear Jim,

Thank you for your reply.

Worldwide Wine Investments contacted me saying that in anticipation of 2010 release they were eager to clear final 2009 lots. These were Lafite Rothschild at GBP 14000 and Mouton Rothschild at GBP 6800.

The prices seemed good and I gave credit card details for the Mouton. However, alarm bells rang when they gave some reason for wanting a check rather than Credit Card. (Apparently they have such a high turnover that only a certain percentage can be Credit Card.)

I read your comments and stopped the Card payment and told them I was not happy and would not proceed. I did not mention your site but they immediately told me that you were the only negative publicity that they had ever receive. They named you and said that you were banned from all UK websites.

Yesterday I received another cold call from a company European Fine Wine. I will not deal with them but wonder where they all get my name from.

My earlier response to AD:

Thanks for your messages and my apologies for the slow reply. For the reasons given on my investdrinks blog I would not buy from this company. I would be interested to know what business they were proposing.

Comment

The prices for the 2009 Lafite and Mouton are certainly keen. wine-searcher shows that the Lafite is available from £13950 with most merchants listing it at £14,500 and above. The cheapest price for the Mouton is £7400 a case with most merchants listing it between £7500-£8000.

Worldwidewine Investments Ltd changed its name from Clearpoint Trading Ltd on 15th October 2010. Given their short trading history as an wine investment company, I'm a little surprised that they have access to these two wines at such keen prices. The 2009 is still at the châteaux and not due to be delivered until the end of this year or early next year.

As for me being banned from all UK websites this is meaningless nonsense.

I welcome any comments from the directors of Worldwidewine Investments Ltd.

Regarding other companies contacting AD it may be that they agreed for their name to be passed onto 3rd parties. If this was not the case the Data Protection Act may be being contravened here.

Patience please

2011-06-14T09:59:00.000+01:00

Many thanks to those of you who have emailed me with enquiries and questions over the last ten days or so. I have been away and with little time to deal with these emails. I will now try to answer them as quickly as I can. However, my advice is that if you have the slightest doubt about a wine investment company or a proposed deal is either to decide not to go ahead or, at least, do plenty of research before proceeding.

Furthermore, I would never buy from a cold caller.

The 1855 saga continues

2011-05-20T08:19:00.000+01:00

Post on Jim's Loire on the continuing saga of 1855 – still failing to deliver their clients' en primeur purchases, while a move to start a class action against the company gathers pace.

WSTA launches fraud prevention unit

2011-05-15T09:51:00.000+01:00

Welcome news from the Wine & Spirit Trade Association

The WSTA is launching a fraud prevention unit to lead industry efforts to crackdown on fraud in the wine and spirits sectors.

The unit will work with police and customs in combating a range of issues affecting consumers and the trade, from identity theft and counterfeiting to wine investment fraud.

The new unit meets the requirements of the Information Commissioners Office and Data Protection Act for the sharing of information amongst businesses. It will enable WSTA member businesses to legally share information about actual or suspected fraudulent activity within the wine and spirit trade and where necessary liaise with police, customs and regulatory agencies.

Operation Sterling, the Metropolitan Police Service's economic prevention and disruption unit, is working closely with the WSTA to help it achieve its goals.

Acting Detective Superintendent Nick Downing, who heads Operation Sterling, said: "Our work with industry is crucial to combating fraud so we welcome this initiative set up by the Wine and Spirit Trade Association.

"We would advise those considering investing money, whether it be a small or large amount, to do their research and be sure that the companies or individuals they are dealing with are reputable and legitimate. We would further advise that care should be taken with personal details when entering into any financial agreement so as to avoid being conned out of your hard earned cash or having your identity stolen."

Only this month the WSTA stepped in after a member company became victim of corporate identity theft, costing in excess of £10,000. The fraudsters used fake email addresses to obtain a wine order from one of the company's French suppliers before suspicions were aroused and the WSTA alerted the police and others in the trade.

WSTA Chief Executive Jeremy Beadles said: "It's not just consumers who suffer from fraud, it's also damaging to legitimate businesses within the trade and we want to ensure we are taking every possible step to combat the problem.

"Our new unit provides a real focus to our work in this area and enables responsible businesses to legally share information so that we can help the authorities."

Ends
Notes to editors

WSTA fraud prevention unit
Membership of the unit is open to WSTA member companies. They agree to abide by the data protection principles set out by the Data Protection Act 1998, in respect to safeguarding customer information. The unit meets the requirements of the Information Commissioners Office and follows best practice in other industries, including the travel, telecoms and automotive sectors.
fraudalert@wsta.co.uk

The Wine Investment Code

2011-04-27T13:32:00.000+01:00

The latest version of the proposed code can be found here (without background and notes) and here (with full explanation and notes).

Comments welcomed.

Finbow Wines Limited/Nouveau World Wines Limited: administrators appointed

2011-03-31T16:37:00.000+01:00

Trevor Binyon of R S Tenon has been appointed as liquidator to Nouveau World Wines and Nick Wood of Grant Thornton as liquidator to Finbow Wines Limited.

Due to the link between the two companies, Grant Thornton was given the opportunity of acting jointly with R S Tenon, but refused.

Finbow Wines Limited/Nouveau World Wines Limited: URGENT ACTION REQUIRED: Grant Thornton a candidate to be appointed liquidator

2011-03-29T08:54:00.003+01:00

I'm happy to post this notice at the request of Grant Thornton. See also here.

"Finbow Wines Limited - In Liquidation & Nouveau World Wines Limited - In Liquidation

URGENT ACTION REQUIRED

30 March 2011 - Meeting of creditors to appoint an insolvency practitioner to act as liquidator

The Fraud Insolvency Division (FInD) at Grant Thornton UK LLP have been approached by in excess of £1m in value of investors to act as joint liquidators in the matter of Finbow Wines Limited at a meeting of creditors to be held at The Official Receiver's offices in London at 10.30am on 30 March 2011.

Nick Wood and David Ingram are also happy to accept nominations to be appointed as joint liquidators of Nouveau World Wines Limited, a company connected to Finbow Wines Limited in order, at the Official Receiver's request, to allow the two liquidations to be dealt with by the same firm. We have successfully dealt with a number of wine investment companies making good recoveries for investors. There is likely to have been movement of monies and stock between the 2 companies and it would be more cost efficient for creditors to have both companies dealt with by the same liquidator.

Nominations must be lodged with the Official Receiver by noon today, however late nominations will still be lodged with the Official Receiver and may still be accepted.

Should you be an investor in Nouveau World Wines Limited and wish to discuss this process and the forms required or wish to nominate Nick Wood and David Ingram of Grant Thornton UK LLP please contact Samantha Locke at Grant Thornton UK LLP as a matter of urgency on 0207 728 2651 or alternatively email her at samantha.j.locke@uk.gt.com.

There will be no charge to investors in making this nomination and a report of the outcome of the meeting will be provided at no cost.

For further information regarding Grant Thornton's insolvency investigation services please visit http://www.grant-thornton.co.uk/intermediaries/fraud_insolvency_division.aspx FInD's fees can be conditional upon recoveries made and therefore creditors may not need to fund recoveries and spend further money thereby throwing 'good' money after 'bad'.

FInD specialise in tracing and recovering assets and are a national team together with an international reach with a presence in all offshore financial centres. They have recovered assets from many jurisdictions and are currently successfully recovering monies for victims of various investment scams, including off plan property developments, mortgage fraud and boiler room fraud, in the UK, Spain, Caribbean, USA, the Middle East and other overseas jurisdictions.

They have a proven track record and sector expertise and are currently running over 600 asset recovery cases. They regularly work with various police fraud squads, the Serious Fraud Office and the Crown Prosecution Service."

Primeurs 2010 - when to publish? asks Jancis Robinson MW

2011-03-23T12:13:00.008Z

Jancis Robinson MW@a conference in Porto December 2010

Good and thought-provoking article by Jancis Robinson MW asking how journalists covering the 2010 Bordeaux en primeur tastings can avoid becoming part of Bordeaux's sales machine:

23 Mar 2011 by Jancis Robinson

'It looks, against all odds, as though Bordeaux may just have another sought-after vintage on its hands with the 2010s (see Vintage reputations - the struggle for truth). Asian markets, with the tragic exception of Japan, seem to be on fire for classic, investment-grade wines. The Americans look ready to come back into the picture for Bordeaux primeurs, having sat out 2009s to a great extent. Many economies are in a much healthier state than the British one, and even in the UK there is no shortage of potential investors with, for example, bonuses burning to find an amusing home. No wonder the UK's fine-wine traders are in such fine fettle. This year they don't even seem to be bothering to demand reasonable pricing from the top Bordeaux proprietors - who are currently rolling in cash, as any visitor to the Médoc and its myriad building projects can attest.

I have already tasted some 2010s and can see that there will be considerable interest in them. I am going back to Bordeaux twice, once at the end of this month and once at the beginning of next, to taste this embryonic vintage as thoroughly as is possible as usual, but I really do wonder what to do with my tasting notes.'

Read the rest here: http://www.jancisrobinson.com/articles/a201103204.html

Probably the only way for journalists to escape Bordeaux sales machine is not to go until the wines are closer to being ready and after the prices have been released. By which time, of course, most of the wines will have been sold and a critics comments may not be very relevant.

See also the open letter from Michel Bettane, the prominent French wine critic, to Sylvie Cazes of the UGCB.

Nouveau World Wines Ltd and Finbow Wines Ltd: creditors meeting 30th March 2011

2011-03-13T08:17:00.002Z

I'm posting a letter from Mark Hendrick of RSM Tenon, a corporate recovery firm, to one of the creditors. Tenon is one of the companies in the running to be appointed liquidator of Nouveau World Wines Ltd and Finbow Wines Ltd. This will be decided at a creditors meeting starting at 11.00am on 30th March 2011 at the offices of the Insolvency Service, 21 Bloomsbury Street, London WC1B 3SS (near Bedford Square).

A proxy forms have to be lodged with the Official Receiver not later than 12 noon on Tuesday 29th March 2011 to entitle creditors to vote by proxy at the meeting (together with a completed proof of debt form if they have not already lodged one).

Please note that I will happily post similar letters/notices from other companies looking to be appointed as liquidator for Nouveau World Wines Ltd and Finbow Wines Ltd.

••

Mark Hendrick:

I write further to our telephone conversation of today concerning the above and can confirm that Mr Trevor Binyon of this firm has been asked to accept an appointment in acting as Liquidator in both of these matters further to the winding up orders obtained against them on 20 October 2010 further to a petition presented by the Secretary of State for Business Innovation & Skills on the basis it was in the public interest to do so.

For your information, I attach further copies of the Official Receiver’s report to creditors in both cases. (Not included in this post - Jim)

Suffice to say, the reports themselves do not make for very good reading. Clearly, it will be for any appointed Liquidator to undertake a detailed investigation into the demise of the businesses in order to ascertain the quantum of any recoveries to be made from third parties associated to both businesses.

It should be noted that in the Official Receiver’s report, reference is given to recoveries for a Liquidator to consider given the quantum of money received by the companies and the fact that very little was spent on wine.

It is in this regard that Mr Binyon has confirmed his willingness to act.

You may not be aware that it is the intention of the Official Receiver to convene a meeting of the company’s creditors which is due to take place at their offices at 21 Bloomsbury Street, London WC1B 3SS on 30 March 2011.

I will be in attendance at this meeting representing various clients/investors who will be nominating Mr Binyon to act as Liquidator as mentioned above.

For your information, the purpose of the meeting is purely to allow creditors to nominate an Insolvency Practitioner of their choosing in dealing with the winding up of the company. It may also be possible to form what is known as a Creditors’ Committee to assist the Liquidator in his dealings.

We discussed how a firm such as my own comes to be involved in these matters. In simple terms, we are either known in our specific field, or we are instructed direct by clients. In this instance, both situations apply.

Insolvency practitioners within RSM Tenon have been appointed to act in cases such as Churchill Wines and Wine Traders International. In those cases, we successfully recovered funds in excess of £2m to date, but in addition with we recovered over £500k in additional assets. Wine Traders is ongoing and we are confident of a return to creditors. This is all being done with the knowledge and support of a creditors committee.

We have been able to make a success of this through our resources and ability to incur costs up front, to second staff from other departments, our ability to utilise RSM Tenon resources such as tax and forensics, and creditors will benefit from the RSMi network in due course. We have also worked without the benefit of cost protection, meaning it is our risk that we take for our clients.

In any event, as requested, I attach for your attention the applicable forms of proof of debt and proxy for your use in relation to the meeting on 30 March 2011.

I can confirm that I would be delighted to assist in relation to the meeting, answer any questions you have at this point and perhaps you can contact me at your convenience to take matters forward.

With kind regards

Mark Hendrick

Associate Director / Corporate Recovery
RSM Tenon
T: 020 7448 8115
F: 020 7448 8105
mark.hendrick@rsmtenon.com
www.rsmtenon.com

BBC Money Box on land banking scams

2011-03-10T08:45:00.001Z

'Thousands of people are being persuaded to invest large sums of money in land which is almost worthless, the BBC has learned.

The Financial Services Authority (FSA) said it was investigating about 20 schemes, known as land-banking or land investments.'

Watch the video here of how one man was conned into 'investing' £100,000 in worthless fields.

CB Vintners/ CBV Publishing: 'Don't risk it' says Tony Hetherington

2011-03-06T10:02:00.002Z

Tony Hetherington (MailOnline) looks at CBV Publishing/ CB Vintners:

'B.S. writes: I am sending you the mailshot I have received from CBV Publishing. I would really like to have the 15 per cent return that it offers, but in these days of low interest, how on earth can this company pay it? Am I missing out on a great deal?

His conclusion?

'So, are you missing out on a great deal? Yes - a great deal of worry over the next year as you realise that you have handed over your money to a company whose name is nothing like the one it uses, and which is not even in the same country as the only two addresses it gives out. Don't risk it.'

VinVende Courtier – 'false' bonded warehouse partnership claims

2011-03-05T08:30:00.001Z

VinVende Courtier, which appears to be based in Hong Kong, claims to have a partnership with London City Bond, one of the UK's leading bonded warehouses. I was told yesterday by LCB that the claims of a special 'partnership' below are 'false' and 'untrue'. The company does, however, have an account there.

'Vin Vende Courtier has partnered with London City Bond (“LCB”) as part of our ongoing goal to maximise the security of clients’ wine investments.

Our aim is to give our clients the maximum comfort ininvesting in wine, for example when you buy a case of wine from Vin Vende Courtier yourproof of purchase will include confirmation of London City Bond holding with unique rotation number, certification of ownership and photoconfirmation of your physical wine with reference numbers that correspondwith all the above paper work, this is revolutionary within the marketplace and we believe this is now the only way wines should be traded.'

I don't know how active VinVende Courtier is as both links for their contact details on the website are broken.

UK Fine Wine Investments: compare and contrast

2011-03-03T12:39:00.003Z

Extract from company website:

'Professional service that is undoubtedly second to none.

Here at UK Fine Wine Investments we are a brokerage specialising in premier cru (meaning First Growth) wines from the Bordeaux region of France. We pride ourselves in delivering of a congruent, first-classed tailored service to each and every client. Not only do our established, select team of brokers and market analysts work perpetually to ensure our client demands are satisfied, they also go that extra mile to embellish a long-lasting positive relationship.'

From Companies House:

UK FINE WINE INVESTMENTS LTD
TOWER 42
OLD BROAD STREET
LONDON
UNITED KINGDOM
EC2N 1HQ
Company No. 07483335

Status: Active
Date of Incorporation: 05/01/2011

'to embellish a long-lasting positive relationship' – less than two months to date.

Inheritance tax: current value

2011-03-03T11:27:00.000Z

Given the alarming number claims on the websites of companies offering wine investment that profits on wine are tax-free in the UK, the following extract from the August 2010 newsletter from HM Revenue & Customs should provide a cold shower of reality.

'Wine valuation

It has been brought to HMRC’s attention that information in the public domain indicates that for Inheritance Tax purposes wine cellars are valued at the purchase price rather than the value at the date of death. This is incorrect.

Section 160 IHTA1984 states that for Inheritance Tax purposes the value of any property is the price it might reasonably be expected to fetch if sold in the open market at that time.

Therefore it is clear that a wine cellar must be valued at its open market value for Inheritance Tax purposes at the time of the relevant occasion of charge.'

It should also be remembered that the notion of 'wasting assets' does not apply for the purposes of inheritance tax.

1855 (1855.com, 1855.con): nearly 500 cases for 300,000 €!

2011-02-27T14:55:00.004Z

Château Beychevelle: 2005s and 2007s outstanding

The extraordinary tally of Bordeaux en primeurs not delivered by 1855 to its clients continues to mount and becomes ever more jaw-dropping. Nearly 6000 bottles remain to be delivered for a value of close on 300,000€.

As of today, the tally of wines known to have been ordered, paid for but not delivered has reached 5930 bottles (494 cases) for an estimated value 295,883€. The value is the cost to buy calculated by taking the cheapest price credible price from UK merchants on wine-searcher.

Vintage breakdown

2002 1 bottle 39.93€

2003 118 bottles 10,330.77€

2004 353 bottles 10,808.35€

2005 3734 bottles 170,372.96€ (+ 4 bottles Flor de Pingus 275€)

2006 1131 bottles 49,341.05€

2007 589 bottles 54,755.08€

Although it is clear that 1855 (1855.com) got into big problems with the 2005 en primeurs, these figures show that the difficulties had already started with the 2003 and 2004 vintages. Fabien Hyon's (COO of 1855) explanation that the failure by 1855 to deliver the ordered en primeurs is down to the economic crisis of 2008 looks increasingly unlikely.

Hyon said that only 5% of the en primeurs ordered had yet to be delivered. Not knowing the total value of the en primeur orders placed for the vintages 2002-2007, it is impossible to know whether Hyon's figure is correct. However, 1855's total turnover is around 10 million euros and en primeur is only part of their business, so 5% may be an underestimate.

Do 1855 have the resources to supply both the undelivered en primeurs from 2002-2007 as well as the 2008s, whiuch are due in June?

1855 is a member of Fevad (la Fédération des entreprises de vente à distance).

From 1855's press release of 31st January 2011 announcing that they had become a member of La Fevad

'La Fevad accorde depuis toujours la plus grande importance à la promotion de règles fondées sur des valeurs de transparence et de respect du consommateur. Ces règles garantissent l`éthique de la profession et permettent de renforcer la confiance des consommateurs, dans l`intérêt de l`ensemble de la profession.'

'Toute entreprise membre de la Fevad s`engage à respecter les principes généraux et les règles prévus par les codes et chartes de la Fevad, tant dans l`esprit que dans la lettre.

"Le fait pour 1855 d`être devenu membre à part entière de la Fevad et signataire de ses codes et chartes est une nouvelle illustration de notre engagement à bâtir une qualité de service de référence » selon Fabien Hyon, Directeur général de 1855."

Contact Presse
Lucie Delaruelle
Responsable Communication, 1855
Tél. : +33 (0) 1 42 61 06 55 - Email : ldelaruelle@1855.com

Voluntary code for wine investment

2011-02-25T15:42:00.002Z

Readers of Jancis Robinson's site will have seen yesterday a request in her 'Free for all' section for a graphic designer to design a logo for a voluntary code for wine investment. Jancis' request produced a number of promising responses.

A voluntary code for wine investment is currently being developed with a number of companies who either offer wine investment or who sells 'investment grade' wine. This code is intended reflect existing good practice. It is hoped that agreement can be reached in time for the code to be launched before the 2010 en primeur campaign starts.

Although it is too early to publish the draft code or to list those companies that have indicated support in principle, any company who would like to see the draft can email me. A number of journalists/writers are supporters of the code in principle pending the agreed text.

Anon

Thanks for your two comments below about CB Vintners. Following your mention of lovemoney.com here is a piece by Tony Levene on a phone call from a wine scammer. The page also has a video with Tony explaining why he has a blog about scams and why he is called 'The Scam Magnet'.

NB (28th February 2011)

Guaranteed returnsCompanies selling investments that are regulated by the FSA are not allowed to make claims of guaranteed returns. If wine investment was regulated the sort of claims claims made by CB Vintners below would not be allowed.

Albany Portfolio Management: price checker

2011-02-25T10:17:00.000Z

Albany Portfolio Management, who are linked to Albany Vintners, has a useful price checker on their site. This price checker is a slimmed down version of the excellent www.wine-searcher.com, which some people can find confusing because it does provide so much information. APM's version calculates an average price for any wine on wine-searcher, so giving an indication what you can expect to pay for a wine. To make sure the results are not skewed the 10% cheapest and 10% most expensive prices are excluded.

1855 (1855.com, 1855.con): latest update

2011-02-14T09:53:00.002Z

Château Gazin (Pomerol): some 2005s and 2006s still outstanding

The current tally of wines not so far delivered by 1855.com now stands at: 4782 bottles (398.5 cases) with an estimated value of 239,130€.

There was some good news in early February when a customer received their 12 bottles of 2007. However, this has been far outweighed by details of one very substantial order that remains outstanding.

I continue to keep a tally so please email me the details on jim@investdrinks.org

1855 has recently become a member of FEVAD – fédération du e-commerce et de la vente à distance.

From FEVAD's charter:

'Réguler

La Fevad accorde depuis toujours la plus grand importance à la promotion de règles fondées sur des valeurs de transparence et de respect du consommateur. Ces régles garantissent l’éthique de la profession et permettent de renforcer la confiance des consommateurs, dans l'intérêt de l'ensemble de la profession.'

The Premier Wine Company: a clarification received

2011-02-13T13:00:00.004Z

'I have received the following message from Leigh Cramer of The Premier Wine Company, which I'm very happy to post particularly in respect to the other companies with similar wording on their websites – see here.

Dear Mr Budd,

I write with reference to your recent blog. Firstly, I would like to state that there is no correlation or business relationship with The Premier Wine Company and the following companies:

Mortimer House
Fine Wine Solutions
Beaumont Vintners

There was a major staffing change in The Premier Wine Company as well as a director departing and we were the victims of the unauthorised usage of our intellectual copyright amongst other problems- which we are pursuing through the relevant channels. Hence, our website and brochure bear similarities to the above, but not with our blessing. Our company is doing very well and we have a fantastic track record with our suppliers and clients, many of which we are sure would give very positive testimonials. You cannot tar us with the same brush as others. Please do not try to defame our company by suggesting that we are anything other than legitimate or we may consider legal action if it is proven that we have made a loss as a direct result of your comments.

Yes, we do appreciate that there are fraudulent or misleading companies out there, but we most certainly are not. Yes we do charge a small premium for our portfolio management services, which has proven to earn our clients money. Many companies listed in your ‘companies you might buy from’ charge an exit commission.

What is more?- 10% on entry of say £10,000 or 10% on £20,000 on exit. Clients buy in, but they could be trapped and don’t know how to get out or it may cost them a fortune to exit. Last year I personally purchased Lafite Rothschild 2008 from a company for £7,100 each- they are now trading anywhere between £15,000 and £17,500 from companies that you recommend....I recently went back to the very same company that sold it to me to trade out of my wine and they offered me under £11,000- disgraceful! If I was unable to trade out using our own client base what would the exit strategy be??

Yes we are relatively new compared to some companies that have had the market for themselves for so long, but it is nonsense and anti fair trade not to allow competition into the market, which is quite clearly a benefit to the whole commercial wine trade.

I would love to drink my Lafite. We all like to dream that people want to buy wine for drinking, just like we buy homes to live in, but reality is that the majority want to make a profit. Look at Andrew Lloyd-Webber...surely he did not purchase his large wine collection for his own indulgence yet he sold at auction for a huge profit!? You have to accept that many people are viewing the fine wine market as an investment when more traditional means have been destroyed by the current financial climate.

Yours Sincerely,

Leigh Cramer

The Premier Wine Company
1st Floor, No1 West Street,
Bromley, Kent, BR1 1RE
Tel: +44 (0) 560 368 1174

My comments:

Leigh Cramer is incorrect to say that I'm against wine investment. It exists and clearly in the current economic climate a limited number of wines have certainly out-performed other more traditional forms of investment.

Of course brokers and fine wine merchants charge a commission when selling wine. I have never suggested they do not. As wine investment is generally a medium to long term investment it makes sense to pay commission when you want to sell. Otherwise it is perfectly possible that paying commission on purchase will also mean paying a commission at the time of sale as the company the wine was purchased from could have ceased trading when the client wants to sell.

Unfortunately wine investment, with the exception of wine funds, is not regulated. Nor is there an industry code of conduct that would provide some guidance to potential investors. Leigh Cramer's experience of a number of other companies using very similar wording to that of The Premier Wine Company illustrates the problem.

'it is nonsense and anti fair trade not to allow competition into the market'. I'm not sure who Leigh Cramer has in mind here. I'm certainly not against new, reputable companies setting up. Indeed some of today's leading wine broking companies have a relatively short history: Bordeaux Index Ltd, for instance, was incorporated in 1996. It is, however, entirely fair to expect a company to establish a track record before being considered as a possible recommendation as a company from whom to buy en primeur.

'unauthorised usage of our intellectual copyright'
Looking at The Premier Wine Company's website I suggest there are several quick ways of distinguishing this site from other companies that Leigh Cramer alleges have used used their text without permission:

• Details of when the company started trading

• Brief bios and contact details of the company's directors

• Price list
• Amend the tax advice. 'Our compliance dept keep a close...' Not all fine wine is considered a 'wasting asset' by Customs & Revenue and may be subject to capital gains. Fine wine may also be subject to inheritance tax.

• Undertake not to use cold calls.

'Please do not try to defame our company by suggesting that we are anything other than legitimate or we may consider legal action if it is proven that we have made a loss as a direct result of your comments.'I have always undertaken to change/amend anything on this blog or www.investdrinks.org if it is shown to be inaccurate or untrue.

Seale Wines Ltd – a reminder

2011-02-08T15:05:00.001Z

A reminder to clients of Seale Wines Ltd that I'm happy to pass their details onto the section in the Metropolitan Police who are investigating this company. You can be assured that your personal details will not be published.

BBC London Inside Out – wine investment scams

2011-02-08T09:21:00.006Z

This is now on the BBC iplayer.

I'm delighted to see fraudulent and dubious wine investment companies under the media spotlight and I thought the report was well done. However, my suggestion that the police are not doing enough needs clarification.

The programme said I thought the 'police were not doing enough'. They didn't use a direct quote and while this is fair comment overall I did say that I was pleased to see current investigations by The Met, City of London police and the investigations by Hertfordshire police.

It was interesting that the anonymous interviewee claimed that Kai Seale was only the front man for Seale Wines Ltd and that it was actually run by someone else. If this is correct who was actually running the company and how many other companies does this shadowy person run?

Following the Inside Out programme I have been contacted by Jeremy Marshall of Irwin Mitchell (details here):

'I am a litigation partner in Irwin Mitchell. If you have not had any lawyers contacting you already, it is likely that you will do so to suggest that you may want to let the victims know that a bit of collective redress may be possible. Two immediate issues arise - firstly, there may well be a cause of action against the director as well as against the company and, secondly, there may be issues to confront re a stay of civil proceedings pending criminal. It is possible to seek judgments against both potential targets, bankrupt/liquidate them and ask office holders to investigate their affairs. It should also be possible at a relatively early stage to get an order against defendants to disclose assets. Depending on those assets, a third party funder may support a claim. I would suggest a representative claim (where all claimants have to have the same interest). There is also the possibility of a compensation order in future criminal proceedings.

If anyone wants to email me (Jeremy Marshall ) I would happily talk to people.'

I'm very happy to pass on Jeremy Marshall's message for information. Obviously anyone considering this legal avenue will want to decide for themselves whether this will be to their advantage or not.

The Bordeaux Wine Trading Company

2011-02-08T08:52:00.000Z

I have received a number of comments and enquiries about last year's trial and have reported that Benedict Moruthoane was found guilty and jailed for 7.5 years for his part in The International Wine Commodities and Templar Vintners fraud.

With respect to the Bordeaux Wine Trading Company there is to be a retrial in June. As I have no wish to publish anything that might prejudice this trial, I have decided that I will not publish any further comments at this time.

Kai Seale - Seale Wines Ltd – arrest made + BBC programme

2011-02-04T18:16:00.000Z

Early this morning the Metropolitan police arrested Kai Seale, the sole director of Seale Wines Ltd, as part of their investigation into the company. He was interviewed and bailed pending further enquiries.

BBC London Inside Out's edition on Monday 7th February 7.30pm will feature dubious wine investment companies. Inside Out have spent six months investigating such schemes and they will be the first feature on Monday's programme, which will be screened in the London area. Seale Wines Ltd are one of the companies covered. Apparently Sky viewers can pick up the regional variations. From Tuesday the programme will be available on thr BBC iplayer.

Very early April fool: 1855 joins Fevad (fédération du e-commerce et de la vente à distance)

2011-02-02T15:46:00.003Z

Château Brainaire-Ducru (St Julien): some 2004 and 2005s not delivered

Incredibly it was announced on Monday that 1855 (1855.com) had become a member of Fevad (fédération du e-commerce et de la vente à distance). Some things just take your breath away – is this this really serious or has April 1st come early this year?

Fevad is supposed to give an assurance that e-buyers are dealing with reputable companies. Instead they have accepted 1855 (1855.com) that increasingly gives the appearance of being a fraudulent ponzi scheme failing in a substantial number of instances to deliver the en primeurs that their customers have ordered and paid for usually including the transport and tax when the wine is allegedly ready to be delivered.

The latest tally of undelivered en primeurs is 2810 bottles (234 caisses) worth an estimated 165,000€ for vintages from 2002 to 2007! Furthermore it won't be long before we discover whether there are similar problems with 2008 en primeurs.

The press announcement:

'1855 est devenu membre de la Fevad, la Fédération des entreprises de vente à distance. La Fevad a pour pour mission de fédérer et représenter l'ensemble des acteurs du e-commerce et de la vente à distance, d'accompagner les entreprises et de promouvoir le développement du secteur.

La Fevad compte parmi ses membres les grandes enseignes de vente à distance, les principaux spécialistes de la vente sur internet (pure-players) ainsi que de très nombreux sites de e-commerce issus d'enseignes du commerce de détail, de la presse ou du luxe.

From Fevad mission statement (http://www.fevad.com/index.php?option=com_content&task=view&id=117&Itemid=380):

Réguler

La Fevad dispose d'un code professionnel, mis à jour régulièrement pour s’adapter aux évolutions technologiques et législatives, ainsi que d'une Charte de Qualité adoptée en 1996 et complétée en juin 2000. En 2005, la Fevad a adopté la charte de l’e-mailing élaborée dans le cadre de l’UFMD et approuvée officiellement par la Cnil. En 2006, elle a publié la Charte de Confiance des plates-formes de vente entre internautes signé par le Ministre du Commerce et les 5 plus grandes plateformes concernées.

Toute entreprise membre de la Fevad s’engage à respecter les principes généraux et les règles prévus par les codes et chartes de la Fevad, tant dans l’esprit que dans la lettre.'

Fom the professional code – an undertaking that the company has acccess to stocks of the items it is selling. Clearly this is not the case frequently not the case in respect to 1855's sales of en primeur.

'43. Disponibilité des articles

Les entreprises veillerontà indiquer de manière apparente que leurs offres ne sont valables que dans la limite des stocks disponibles,sauf si elles sonten mesure d'honorer la totalité des commandes. Pour le débutde la période de validité des offres de vente, les entreprises veillerontà disposer de stocks en rapport avec leurs prévisions.'

http://www.fevad.com/

I urge all those still awaiting for their en primeurs and any other wins ordered from 1855 (1855.com) to complain to Fevad. I'm ready to let any journalist wishing to cover the 1855 scam have a copy of the file showing the quantity of wines outstanding.

If Fevad is a serious organisation, it is incredible that they appear not to have checked out 1855 (1855.com) properly before accepting their membership.

Compare and Contrast: Premier Wine Company/ Mortimer House

2011-01-25T00:10:00.002Z

Introducing The Premier Wine Company

Formed by a group of experienced and successful businessmen and traders, The Premier Wine Co are providing an opportunity for our clients to gain a foothold in the thriving and prosperous fine wine market.

We specialise in rare, prestigious Bordeaux fine wines such as Lafite Rothschild, Mouton Rothschild, Chateau Margaux, Chateau Latour and Chateau Haut Brion, which have all proven to make safe and significant gains as an alternative investment in a changing global economy.

Our ability to secure tangible, solid returns in a relatively short period of time is second to none.

Our entire team are well educated and have an exemplary depth of knowledge and performance within the fine wine market - many forming long term relationships with our clients.

Once purchased our fine wines are either shipped or stored in a renowned bonded warehouse/cellar in perfect homeostatic conditions and insured to the current market value.

Rest assured, The Premier Wine Co will deliver an unequivocal personal service and will provide the conditions for the client to build up a credible portfolio of fine wines.

Introducing Mortimer House

Mortimer House is part of a group of extremely successful companies that specialise in property construction and development, commodity broking, finance (ForEx) and trading in precious metals. Formed by a group of experienced and successful businessmen and traders, Mortimer House is now providing our clients with an opportunity to gain a foothold in the thriving and prosperous fine wine market.

Mortimer House specialise in rare and prestigious First Growth Bordeaux fine wines such as Chateau Lafite Rothschild, Mouton Rothschild, Margaux, Latour and Haut Brion as well as wines from the Pomerol Appellation including Chateau Petrus, Le Pin and Chateau Ausone. All of these wines have proven to make safe and significant gains as an alternative investment in a changing global economy.

Our ability to secure tangible, solid returns in a relatively short period of time is second to none.

We are committed to ensuring our clients receive the best market knowledge and access to opportunities that have previously only been available to a select clique. It is our fundamental objective to ensure complete customer satisfaction with our range of services and products.

Our entire team is extremely experienced and has an exemplary depth of knowledge and performance within the fine wine market - many having formed relationships with clients going back many years.

Once purchased our fine wines are either shipped or stored in the clients named account at a renowned bonded warehouse/cellar in perfect homeostatic conditions and insured to the current market value.

Rest assured, Mortimer House will deliver an unequivocal personal service and will provide the conditions for the client to build up a credible portfolio of fine wines.

1855.com: possible class action

2011-01-24T08:52:00.002Z

Château Cos d'Estournel (Saint Estèphe)

Michael Haynes, a UK lawyer but based in France near Bergerac, is planning to put together a class action against 1855 (1855.com). Like so many other 'customers' of 1855 he is owed a considerable quantity of en primeurs from the 2005, 2006 and 2007 vintages.

Michael would like anyone owed wine by 1855 (1855.com) to contact him supplying details – the ideal would be for each claimant to supply me with a print out of their order from their a/c page from 1855.com, plus an edited version showing just the wines outstanding (as the a/c page shows both outstanding and already delivered orders) with an estimate of their current value.

The best way of finding current value I find (Jim) is to check on www.wine-searcher.com. I find it easiest to restrict the search to UK merchants using euro as the currency and to search for full cases rather than a bottle price.

Contact details:

Michael Haynes
'Paute'
24500 Eymet
France

Tel: (+33) 05 53 74 23 11
Mob/portable: 06 72 34 99 83

email: michael@rosbifs.com

•

Current tally of wines not delivered by 1855 (1855.com):

2122 bottles (176+ cases) for an estimated value of over 137,000€. With details of a further 150 bottles awaited.

Beaumont Vintners Ltd/Castlegate Wines Ltd: compare and contrast

2011-01-17T21:58:00.002Z

Beaumont Vintners:

Thank you for visiting Beaumont Vintners.
Formed by a group of experienced and successful businessmen and traders, Beaumont Vintners are providing an opportunity for our clients to gain a foothold in the thriving and prosperous fine wine market.

We specialise in rare, prestigious Bordeaux fine wines such as Lafite Rothschild, Mouton Rothschild, Chateau Margaux, Chateau Latour and Chateau Haut Brion, which have all proven to make safe and significant gains as an alternative investment in a changing global economy.

We are committed to ensuring our clients receive the best market knowledge and access to opportunities that have previously only been available to a select clique. It is our fundamental objective to ensure complete customer satisfaction with our range of services and products.

Our entire team are extremely experienced and have an exemplary depth of knowledge and performance within the fine wine market - many forming long term relationships with our clients.

Once purchased our fine wines are either shipped or stored in The London City Bond in perfect homeostatic conditions and insured to the current market value.

Rest assured, Beaumont Vintners will deliver an unequivocal personal service and provide the conditions for the client to build up a credible portfolio of fine wines.'

Company founded: 18.6.10 probably started trading autumn 2010.

***

'Introducing Castlegate Wines

Castlegate Wines Limited was formed by a group of experienced and successful businessmen, traders and wine collectors. The directors have built up a large private portfolio of fine wines over the years and decided that a ‘special purpose vehicle’ (SPV) was required to trade their assets in a fashion they could control and expand the opportunity for new clients to gain a foothold in the thriving and prosperous fine wine market.

We specialise in rare and prestigious Bordeaux fine wines such as Lafite Rothschild, Mouton Rothschild, Château Margaux, Château Latour and Château Haut Brion, which have all proven to make safe and significant gains as an alternative investment in a changing global economy.

Our ability to secure tangible, solid returns in a relatively short period of time is second to none.

We are committed to ensuring our clients receive the best market knowledge and access to opportunities that have previously only been available to a select clique. It is our fundamental objective to ensure complete customer satisfaction with our range of services and products.

Our entire team are extremely experienced and have an exemplary depth of knowledge and performance within the fine wine market - many forming long term relationships with our clients.

Shortly after purchase our fine wines are either shipped, stored or title is transferred to the purchaser to a renowned bonded warehouse/cellar in perfect homeostatic conditions and insured to the current market value. In the event that ‘En Primeur’ is purchased, the wine is stored in barrel at the Château and then transferred to the bonded warehouse shortly after it is bottled.

Rest assured, Castlegate Wines will deliver an unequivocal bespoke service and will provide the conditions for the client to build up a credible portfolio of fine wines as well as a realistic trading platform to liquidate your assets for the best possible return.'

Company founded: 21.10.2010 – Castlegate Ventures Ltd

'Our ability to secure tangible, solid returns in a relatively short period of time is second to none.' As the company was founded less than three months ago 'relatively' is a nice touch!

Benedict Moruthoane sentenced to 7.5 years for fraud

2011-01-14T10:32:00.001Z

On 5th January 2011 Benedict Moruthoane was sentenced to 7.5 years in prison for fraud in respect to two wine investment companies: International Wine Commodities Ltd and Templar Vintners Ltd. Neither company bought any wine – IWC took some £800,000 from investors and Templar Vintners £100,000. Hertfordshire police raided and closed the offices of IWC in October 2008. They closed Templar Vintners down in January 2010 soon after it started operation.

Just before Christmas, following a trial at Saint Albans Crown Court lasting two months, the jury found Moruthoane guilty just before Christmas. The case followed an investigation by the Economic Unit of the Hertfordshire Police.

In January 2010 Guernsey Financial Services Commission issued a public warning against Templar Vintners Ltd for falsely claiming on its website that it was authorised by the Commission.

James Allie, a Brent councillor and the Liberal Democrat's parliamentary candidate for North Brent at the last General Election, was company secretary for Templar Vintners Ltd. Allie's name was used to give a patina of respectability to the fledgling company

A concerned client of Templar Vintners, who had paid for two cases – 2008 Ausone and 2008 Lafite – received an email purporting to come from Allie but it is likley that it was sent by Moruthoane. It is thought that Allie had no active involvement in Templar Vintners and no charges were brought.

Clearly it was, at the least, careless and foolish of Allie to have unwittingly allowed his good standing and reputation to help persuade potential customers to invest in a fraudulent scheme.

2011 suggested resolutions

2011-01-09T17:12:00.000Z

a) Don't accept cold calls

b) Don't buy from companies you have never heard of, especially if they phone you up out of the blue.

c) Do your research before you buy.

1855 – wines still outstanding

2010-12-19T15:53:00.002Z

As of this afternoon I have details of over 76 cases (915 bottles) of Bordeaux en primeur that have yet to be received by clients of 1855. There are 37 bottles missing from 2003, 18 from 2004, 581 from 2005, 187 from 2006 and 96 from 2007.

Email correspondence with 1855 reveals a succession of promises that the wine will arrive next month but for some next month never comes.

I'm still concerned to collate as comprehensive list as I can of wines that have not been delivered by 1855, so if you are still awaiting wine ordered from this company please email me with the details at jim@investdrinks.org Please be assured that your name will not be published.

Fraud trial@St Albans: jury is still out

2010-12-19T15:44:00.000Z

The jury is still considering its verdicts in this case. They retired on Monday 13th and have now been allowed by Judge John Plumstead to return majority verdicts.

Fraud trial@St Albans: jury retires

2010-12-14T16:10:00.002Z

I understand that the jury retired around 10.30am yesterday morning to consider their verdicts.

No news so far (17.30 14th December) and Crown Court closes at 4pm, so I assume that the jury will continue their deliberations tomorrow.

Wednesay 15th (20.00): No news so I assume the jury is still out and will continue their deliberations tomorrow.

Fraud trial@St Albans

2010-12-10T16:49:00.000Z

I understand that the jury will be retiring first thing on Monday to consider their verdicts.

Fraud trial@St Albans: closing speeches

2010-12-06T17:19:00.000Z

Following the disruption last week to transport caused first by the tube strike and then the snow I wasn't able to get up to St Albans to catch up with the case until this morning.

All the evidence has now been given and closing speeches have started. I heard part of Anne Evans, concluding remarks for the prosecution this morning. She was due to continue this afternoon with the first of the defence speeches starting later today. With the court tomorrow only sitting in the morning, closing speeches won't be finished until sometime on Thursday and then His Honour Judge John Plumstead will be summing up and issuing his directions to the jury, which is now down to 11 members. It looks like the jury will retire to consider its verdict from Friday or Monday. Then it will depend upon how long they need to make their decisions, which may be sometime as there are six defendants. Also there are a number of charges for them to consider, so it may be Tuesday or Wednesday of next week at least before the jury decides on its verdicts.

(I hope to add some detail from Anne Evans' concluding speech as well as from Paul Craven's evidence earlier in the trial.)

London City Bond: collapsed roof@Purfleet

2010-12-06T16:27:00.000Z

As has been reported elsewhere the roof at LCB warehouse at Purfleet collapsed on Thursday evening. It is believed that snow was a contributory factor. Fortunately the collapse happened at 4.45pm 30 minutes after the facility had closed and staff had gobne home, so no one was injured. It is highly probable that the bad weather saved lives here as around Christmas time staff frequently work overtime but the decision was taken to close the warehouse on time (4.15) that day due to the bad weather and poor road conditions, otherwise it is likely that staff would have been working overtime there when the roof collapsed.

Only merchants store at Purfleet, so private reserves are not affected. However, of the 100,000 cases stored there it is estimated that certainly 70% of the stock has been lost and possibly as much as 80-90%. This is through bottles smashed and then subsequent weather damage. Companies using Purfleet tend to be the small to medium players and, of course, a sudden loss especially at Christmas time can have very serious implications for businesses.

Companies known to store at Purfleet include High Spirits, Patriache, HG Wines (the wine company of the St Johns group) and Peter Watts.

Lafite: time to sell?

2010-12-05T11:43:00.002Z

A couple of interesting articles here:

Andy Xie, an ex-Morgan Stanley: 'Sell Lafite now'

Liv-ex blog: Time to sell Lafite?

1855.com – awaiting en primeur deliveries?

2010-12-01T13:58:00.002Z

I have been contacted by several people about outstanding en primeur orders from 1855.com. If anyone is waiting for an order for Bordeaux en primeur wines (vintages: 2003, 05, 06 and 07) ordered through 1855.com, I would be very grateful if you could send me the details of any outstanding orders including when it was ordered and the price paid.

Please email me through jim@investdrinks.org.

Fraud trial@St Albans: tube strike and weather KOs visit

2010-11-29T15:23:00.000Z

Apologies to anyone awaiting news on the trial's progress. It was my intention to go to court this morning as the trial was due to resume at 10.30. Unfortunately the 9.45 from London Bridge to St Albans was cancelled and the 10.00 wasn't expected to arrive until 10.27, so I wouldn't have got to court until around 11.30. Unfortunately I doubt if I now have time to get up there until next Tuesday,

Fraud trial@St Albans: the jury have a week off

2010-11-23T14:11:00.000Z

The jury has this week off because Oseghale Hayble, one of the defendants, has gone to the Whittington Hospital in north London as his sickle cell anaemia has apparently returned. The trial is due to resume on Monday 29th November.

I understand that Craven and Cashman have completed their eveidence and that Hayble's barrister has indicated that his client will not be giving evidence. Moruthoane and Linskill have yet to give their evidence. Once they have done so, it will be time for the closing speeches from the prosecution and the five defendants' barristers before Judge Plumstead sums up and issues directions to the jury. My guess is that the trial is now unlikely to finish before the week beginning 6th December.

Seale Wines: message from the Met

2010-11-16T23:03:00.002Z

I understand that the Metropolitan Police are investigating Seale Wines Ltd. They would welcome details from any clients of Seale Wines Ltd. In the first instance the investigating team would like to know from clients the date of any transactions and how much money they paid.

I'm happy for any clients of Seale Wines Ltd to contact me and I will forward your emails to the Met. You can be assured that I will not publish them. My email is budmac@btinternet .com

New scam: hijacking the good name of reputable wine companies

2010-11-16T21:58:00.005Z

I'm very happy to post details of this new scam that Lionel Nierop of Bid for Wine has brought to my attention. Although not all the 'modi operandi' of this scam are not fully apparent at present, it appears to be similar to the scams that target European producers, particularly in France, attempting to secure consignments of wine without paying for them using the names of legitimate companies.

If anyone has any information about callers hijacking a legitimate company’s good name please email me on budmac@btinternet.com

Once again this is another warning that cold calls are bad news.

Just freeze out cold callers.

Remember that no company authorized by the Financial Services Authority can use cold calls.

From Lionel Nierop, managing director – Bid for Wine:

Wine Investment Cold Calls – a Warning

I’d like to draw to the attention of readers of investdrinks to what appears to be a new scam in the already murky world of wine investment – namely hijacking the name of an established business. The fraudsters then use the name to sell wines for investment, presumably with the intention of pocketing investors’ funds and leaving the legitimate business taking the heat.

I became aware of the ‘scam’ yesterday evening after I was emailed by a gentleman wishing to complain about several cold calls made to him, ostensibly by one of my employees. The caller was apparently rude and persistent.

The email was a surprise and puzzled me for several reasons:

- Firstly we do not solicit for business by cold-calling.
- Secondly we have no employee with the name I was given.

- Thirdly I am deeply sceptical about wine investment in general. This stems from regularly having to auction off stock at for people who have been mis-sold wines as being suitable for investment and have then seen the deal gone sour. I would always advise anyone considering putting their money in to wine to look beyond the sales pitch and, if still convinced, only to consider purchasing wines as from serious, ‘blue chip’ merchants (see Jim Budd’s list).

I am sure that we at Bid for Wine (www.bidforwine.com) are not the only ones who are having our name misused in this manner and I would urge the trade to be vigilant and anyone being contacted by cold-callers selling wine as an investment to take details and pass them on to the police. In addition, if anyone encounters our name in association with such a sales pitch I would be very grateful for any information!

Lionel Nierop

Managing Director
Bid for Wine

www.bidforwine.co.uk
bidforwine.wordpress.com

Tel. +44 (0)207 183 3985
Mob. +44 (0)7762 566894

The Wine Trade Ltd (T/A Bid for Wine) is registered in England & Wales, Company No. 6521437.
Registered Office Address: 2nd Floor, 145-157 St John St, London, EC1V 4PY.
Correspondence Address: P.O. Box 638, Exeter, Devon, EX1 9JY

BBC Inside Out: Olympic Land Scam

2010-11-16T17:36:00.000Z

Investigation by BBC Inside Out London into a land scam based around the London Olympics in 2012 ruined victims. Illustrates again the dangers of cold calls and the ease by which victims can think they are speaking to someone in the UK when actually they are connected to a boiler room scam in Spain.

Click here.

Nouveau World Wines Ltd and Finbow Wines Ltd: bail extended

2010-11-05T11:06:00.001Z

Those arrested in connection with these two companies have been bailed until the last full week of March 2011.

Anyone concerned at the apparently slow progress of this investigation should be aware that investigations into alleged fraud are often lengthy, especially where it is necessary to obtain evidence from abroad. In this case the investigation needs evidence from Australia. I realise that for investors who have lost money the delay is frustrating but I would urge patience.

Fraud trial@St Albans: Paul Craven cross-examined

2010-11-03T16:41:00.006Z

3rd November 2010

I spent this morning in St Albans Crown Court where Paul Craven, one of the defendants was cross-examined by Mr Davis, barrister for Niklas Cashman another of the defendants.

Mr Davis took Craven through his spending – holidays, cars, diamonds, watches, clothes etc. – while at a the Bordeaux Wine Trading Company referring him to a number of bank accounts.

The trial is expected to last at least another two weeks.

Fraud trial@St Albans: Andrew Griffiths

2010-11-03T15:28:00.000Z

3rd November 2010:

Please note that Andrew Griffiths has now been severed (official parlance) from this case with a new trial date to be set in due course. In plain language he is now no longer on trial in this case being heard at St Albans Crown Court.

Wine Traders International Limited (in liquidation)

2010-11-02T15:34:00.002Z

In the High Court of Justice
Chancery Division

Companies Court

No. 1873 of 2010

Wine Traders International Limited (in liquidation)

Take notice that, following a winding up order made on 5 May 2010, Trevor John Binyon and Stephen John Parker of Sherlock House, 73 Baker Street, London W1U 6RD were appointed Joint Liquidators of the said Company at a meeting of creditors held on 28 July 2010. Creditors of the above-named Company are requested, as soon as possible and preferably within fourteen days, to send in to the Joint Liquidators of the said Company their full names, their addresses and descriptions, the name and address of their Solicitors (if any), and full particulars of their debts or claims, including: purchase invoices, evidence of payment to Wine Traders International Limited (or if paid to another entity, its identity), certificates of allocation or ownership, portfolio evaluations and copies of all correspondence with the Company.

••

Please note that this is a statutory legal advertisement that I have happily agreed to post. I urge all creditors to contact the appointed liquidators.

Tony Hetherington on Fine Wine Vintnors (sic)

2010-11-01T10:58:00.001Z

Tony Hetherington exposed Fine Wine Vintnors in his column in the Mail on Sunday yesterday. See here.

Tony kindly mentioned investdrinks.org and I have received a number of enquiries from concerned investors. I will reply to all of these queries but it will take a little time. Please be patient.

In the meantime buy only from established companies and certainly never from a company that uses pushy cold calls.

Fraud trial@St Albans: Templar Vintners Ltd

2010-10-19T19:02:00.156+01:00

(Proceedings rather seem to have jumped ahead of themselves moving rapidly onto Templar Vintners, the third and most recently formed company involved in this trial. A question I think of juggling with witnesses' availability. Doubtless there will be a return to evidence involving the Bordeaux Wine Trading Company and International Wine Commodities.

The Judge – His Honour John Plumstead may have revealed that the judiciary have also been subject to government cuts when he referred to 'his creaky old laptop'.)

Dr Francis Leigh Moss

Dr Moss explained that he had been contacted on his mobile phone by a Daniel Price, a salesman for Templar Vintners Ltd. Initially he was surprised to be contacted on his mobile as he rarely gave the number out. On reflection Moss thought he might well have filled out a form expressing interest in buying wine for investment. He had already previously bought wine for investment from the Bordeaux Wine Company.

Moss said that Daniel Price was confident, well spoken and had an air of knowledge – he spoke the language (of wine investment). In October 2009 he agreed to buy a case of 2008 Ausone (St Emilion) en primeur for £7740. As well as his invoice Moss received a Templar Vintners brochure, which looked 'glossy', 'professional', 'establishment – at the upper end of the market and a 'multi-million pound' company stating that 'Templar Vintners is one of the leading fine and rare wine merchants'.

In December 2009 Moss bought a case of 2008 Lafite-Rothschild for £4200. After Christmas he decided to rationalise his wine investment portfolio: to sell the less well performing wines to free up funds to buy wines that would show a greater return.

Looking at his portfolio Moss concluded that it was "the highest and scarcest wines from the best vintages – 2000, 2003 etc. which had given the best performance. This was a good time to remove the less good wines from my portfolio, sell them and reinvest. I was open to offers and Templar Vintners raised the question of an exchange."

It was arranged that the wines Moss wanted to sell would be bought by Bordeaux Index Ltd "a highly reputable, secure company (Moss)" and the wines transferred from Branford bond to London City Bond. The deal was worth between £13,000 and £15,000. Templar Vintners would use the money raised to buy new wines for Moss.

Before he went ahead with this new deal Moss decided, given the amount of money involved, that he needed to do more research. He checked with Companies House and discovered that Templar Vintners was incorporated in 2008 and had changed its name during 2009. There were two directors: Andrew Griffiths and James Allie. Moss could find out little about Griffiths but discovered that Allie was a Liberal Democrat councillor in Brent, so felt reassured.

Moss was also worried that the firm's address Hamilton House was 'an address of convenience'. That his contact with Templar Vintners was by mobile phone and that the brochure had used material from other companies – "cut and pasted". "Looking at the brochure I became more concerned – not a true and genuine document'. He told Templar Vintners that he was not prepared at this time to go through with the deal.

On a Friday evening in January around 5pm he spoke on the phone with an Ethan Brook who was "agitated, angry and affronted". Brook accused him of "neneging on the deal – a deal that he had requested". Moss asked for his money back on the previous deals but was told that this wasn't possible for legal reasons as under the Distance Selling Regulations there was a six week tiime period.

Moss asked for reassurance that this was a genuine deal and asked for a signed letter from Andrew Griffiths or James Allie. He asked in particular for reassurances from James Allie as he thought someone in James Allie's position would not be involved in something that was not legal and above board.

Moss never received a signed letter from either Griffiths or James Allie. He did receive an email purporting to come from Allie but it wasn't signed. The transfer never went ahead nor has he received any money back for the two cases of 2008 that he ordered.

Under cross-examination from Mr Smith, representing Andrew Griffiths, Moss agreed that the brochure didn't mention 'multi-million pound company'. However he drew this inference from Templar's claim: 'our clients benefit directly from our immense buying power, amassed through years of experience'.

The trial continues.

3rd November 2010:
Please note that Andrew Griffiths has now been severed (official parlance) from this case with a new trial date to be set in due course.

Fraud trial@St Albans: 'There seemed to be a never ending supply'

2010-10-19T01:00:00.004+01:00

Stephen Creaton

In the second half of last Friday's morning session prosecution witness Stephen Creaton, a tele salesman, gave the first part of his evidence. Creaton described how he had been employed by a number of wine investment companies.

He started with the Bordeaux Wine Company where he worked from approximately April 2006 to October 2006. As he had no previous experience of the fine wine industry – "I'd never worked in wine before" – much of his time at BWC was spent being trained by Anthony. The software programme used was Goldmine, which is a way of keeping a record of calls to customers.

Mr Creaton said that at BWC there was a senior sales team, which consisted of two women, and a junior team which consisted of between 8-10 people. Oseghale Hayble, one of the defendants, was the manager of the junior sales team. Creaton's pay at BWC was £25,000 a year basic then a commission rate that ranged from 2%-4%.

In October 2006 Hayble invited Mr Creaton to join the Bordeaux Wine Trading Company, a new wine investment firm selling en primeur Bordeaux and based in Potters Bar. Creaton moved companies as BWTC was closer to his home and the money was better: £1000 a month retainer and 10% commission once you had earned £1000. It was a two room office operation with the offices separated by a long corridor and a number of other offices that were quite independent of BWTC. The larger room was the salesroom with 9-10 telesales staff. Paul Craven, one of the defendants, was usually in the small office along with a girl who handled the admin.

The sales staff cold called potential investors using a three-page script. Hayble gave Mr Creaton his script. Although Mr Creaton got on well with Hayble the relationship with Craven was more difficult. "They were like chalk and cheese. Craven was rash and harsh – always looking for money. No pleasing him. If you weren't on the phones he wanted to know why."

Creaton became unhappy with the job. The whole set up started to ring alarm bells. This was crystalised when Craven said he was going to Bordeaux to pick up wine. "Although I didn't know all the ins and outs I knew you couldn't just go to Bordeaux to pick up wine as everything goes through the négociants. It wasn't quite right and I was concerned. I stopped selling and started to look for an exit."

Creaton was 'let go' in Spring 2007 and went to work for a family run wine investment business based in Edgeware. He worked in the back office sending out cheques covering for someone who was off on maternity leave. He stayed four to five months.

Creaton received a call from Hayble who told him that he was no longer with Craven and that he was setting up International Wine Commodities Ltd in Wheatstone, although they had a Mayfair postal address. Commission was 10% up to £25,000, 15% from £25,000-50,000 and 25% thereafter. Hayble's partner in IWC was Benedict Moruthoane, another defendant. Creaton said that Moruthoane was the "silent partner" in IWC.

At IWC there was a white board on which the wines they had to push were marked up and the sales team would cross off cases as they sold them. At BWTC there had been an unchanging list of the five First Growths. "The wines stayed the same," said Creaton, "although the price would change. There seemed to be a never ending supply. There was never a stop point."

Creaton explained that he didn't use his own name because business cards had aleady been printed with another person's name and that their elderly customers preferred to deal with someone with an Anglo-Saxon name.

Mr Creaton worked at IWC until the company was raided by Hertfordshire Police who closed down the company. Hayble claimed that this was "a bit of a mistake" and that the police had confused BWTC with IWC.

Creaton was due to be cross-examined on Monday but I wasn't at the court.

2010 Bordeaux vintage: Gary Boom's urges caution

2010-10-18T11:21:00.000+01:00

(Received this morning views of Gary Boom, founder and MD of Bordeaux Index)

Bordeaux harvest update – wine industry prepares for a new episode of ‘twin peaks’

Press Release: October 18th 2010 – The spirits of wine lovers and investors have been buoyed by the news that the 2010 Bordeaux harvest is living up to its early promise, with the quality already being compared in some quarters with last year’s exceptional vintage.

With the harvest now complete, three of the region’s top chateaux have told fine wine merchant Bordeaux Index (www.bordeauxindex.com) they’re expecting this year’s vintage to be remarkable.

“It seems a little premature to mention Bordeaux 2010 when we’ve only just said farewell to the all-consuming jamboree that was Bordeaux 2009,” said Bordeaux Index founder and MD Gary Boom. “But initial reports are that the latest crop is destined to be good, very good indeed.”

Promising early reports from Bordeaux are often greeted with a degree of scepticism within the industry. However, the character and standing of the chateaux involved – Including Angelus, Latour and Le Pin – is adding credibility to the claims.

The final factor in the equation – the weather – has also played its part with warm temperatures in south western France characterising the final stages of the harvest.

“Remembering that 2009 was a truly wonderful vintage, I wouldn’t be that surprised if we have a serious case of vinous twin peaks on our hands,” said Gary Boom.

With the likelihood of another promising pedigree on offer, attention is now focusing on the inevitable question – what price will the 2010 vintage fetch?

Gary Boom is advising a note of caution, “It’s a complicated market at the moment. Normally the arrival of a great vintage is one of the most powerful tools for attracting interest but the reality is that we already have ample supply of ‘prime’ vintages, with plenty of the 00/05/09s sat awaiting consumption. In contrast, it’s the highly sought after ‘off-prime’ vintages of 99/01/04 that are looking increasingly stretched. “

The key factor behind this change in recent years has been increased demand from Asia as brand-based consumption has triumphed over all other factors.

“In short, this market wants the cheapest available vintage of a small set of favoured brands,’ observed Gary Boom. “As we’re on the cusp of another ‘great’ vintage, my advice to investors would be to focus on the 2007/08s with the right labels and be wary of the 2009/05s at the wrong price.”

Fraud trial@St Albans

2010-10-15T17:07:00.002+01:00

Wine investors ‘defrauded of £2.5 million’

The trial of six people involved in three allegedly fraudulent wine investment companies started in St Albans Crown Court this week. The three companies were the Bordeaux Wine Trading Company, International Wine Commodities Ltd and Templar Vintners Ltd. There are a number of charges. Niklas Cashman, Paul Craven, Oseghale Hayble and Benedict Moruthoane are charged with conspiracy to defraud. Benedict Moruthoane and Andrew Griffiths are charged with fraud and Anita Lanskill with transferring criminal property. Although the case is linked, it is believed that none of the defendants was involved in all three companies. All the defendants have pleaded not guilty to the charges.

Investors were persuaded by cold calling telesales staff to invest in Bordeaux en primeur mainly 2005 First Growths. Although the victims paid a total of £2.5 million, it is alleged that the companies only ever bought one £10,350 case of wine. No other orders were placed.

Instead the defendants spent the money on luxury goods, including flash cars and designer watches. The court heard today of a spending spree by 37-year old Paul Craven, who ran the Bordeaux Wine Trading Company. In October 2006 he bought BMW convertible for £20,600. In November he spent over £16,000 on various items in Selfridges including Ozwald Boateng clothes and Cartier watches. In January 2007 Craven bought an electric wine cooler (£1225) as well as a Jacuzzi bath and bathroom TV.

In October 2007 Craven bought a black RR sport Land Rover for £55, 700. The next month he splashed out on a black BMW sports convertible for his girlfriend paying £32,162 on the spot by debit card. The saleman described Craven as 'very cocky and loud – a Jack the lad'.

Shortly afterwards the couple split up. Craven contacted the garage and inquired about selling the BMW back to them but he never came back into the garage to pursue the enquiry further.

The court also heard part of the evidence of Stephen Creaton, a tele salesman who worked for both the Bordeaux Wine Trading Company Ltd and International Wine Commodities Ltd. He will be cross-examined on Monday.

The trial continues and is expected to last four to five weeks.

Wine investment and inheritance tax: a further warning

2010-10-14T16:14:00.001+01:00

News - Tax
Written by Ray Clancy
Wednesday, 13 October 2010 10:25
UK investors in wine are building up huge unexpected tax bills having been misled by salesmen over how HM Revenue and Customs treat wine, it is claimed. HMRC recently produced guidance warning of increasingly widespread misunderstanding that the value of wine investments for inheritance tax (IHT) purposes is based on the purchase price of wine rather than its current market value. Read the rest here. Clearly anyone considering wine investment or who already has wine investments should get professional tax advice and not rely on what some high pressure telesales person tells them. Nor should they rely on claims about wine being a tax-free investment made on some companies' websites. Although many wines but not all are considered by HM Reveue and Customs to be wasting assets, the concept of wasting assets does not apply for inheritance tax. Inheritance tax values are based on current prices and not the price at which the wine was bought**.

FT article on wine investment and inheritance tax

2010-10-13T07:42:00.001+01:00

Interesting article in the FT (5th October 2010) on Revenue and Customs looking at inheritance tax on wine investments:

HM Revenue targets wine cellars
By Ellen Kelleher

Published: October 5 2010 14:48 | Last updated: October 5 2010 14:48

Executors of wills are facing the prospect of paying unexpected tax bills for failing to record the market value of the wine cellars in estates, accountants claim.

Read the rest here.

I wouldn't buy wine from these companies

2010-09-24T16:01:00.002+01:00

I have just added a page to this blog listing companies from whom I would not buy wine.

For a variety of reasons I would not consider buying wine from them. This would apply in particular to ordering wines en primeur. I would not buy for a variety of reasons: the lack of an established track record, the use of cold calls especially when persistent, charging an upfront commission, selling well above the price these wines can be bought from other companies, lack of hard information about the company – its officers, history etc on websites and brochures, exaggerated and unlikely claims made by recently formed companies. The reasons for not wishing to buy from one of these companies will obviously vary from company to company.

Finbow Wines: SIFMA warning

2010-08-25T15:08:00.000+01:00

I understand that Michael Adams and Frank Benson are continuing to contact previous clients of Finbow Wines and offering them deals to assist them recover money invested in Finbow. Apparently one elderly Finbow investor has been stung for a further £15,000 by people claiming to act for SIFMA. It is clear that Adams, Benson etc. have full details of Finbow's clients. I understand that SIFMA (The Securities Industry and Financial Markets Association) are not involved in any way.

If contacted by Michael Adams, Frank Benson or anyone else purporting to represent SIFMA do not agree to their proposals, which are likely to involve further payments to recover Finbow monies. Instead report full details to both your local police, informing them that Finbow Wines is under investigation by the Metropolitan Police and also to file a report on Action Fraud (www.actionfraud.org.uk).

Wine Traders International: liquidator appointed

2010-07-31T14:40:00.001+01:00

I understand that at the creditors' meeting on Wednesday that RSM Tenon were appointed as the liquidators of the company. I am hoping to get further details from Tenon early next week and will post them when I have them.

Two trials to come in the autumn – previous successes for the SFO

2010-07-27T12:18:00.005+01:00

As there are two wine investment trials due to start in October following police investigations, I thought it was timely to list previous prosecutions for conspiracy to defraud brought in these instances by the Serious Fraud Office – see press releases section. Details of some of these trials are on my www.investdrinks.org site.

Cavendish Wine Merchants/Hamilton Spirit Management
This was the first prosecution brought by the SFO in respect to drinks investment fraud and involved 'investments' in barrels of malt whisky. The case involved Lewis Daulby, who pleaded guilty before the start of the trial, Lee Rosser and Julian Blee. Rosser and Blee were found guilty.

Details:
http://www.sfo.gov.uk/press-room/latest-press-releases/press-releases-2001/whisky-and-champagne-investments-four-convicted-for-defrauding-clients.aspx

House of Delacroix
This was an associated trial (early 2001) to Cavendish/Hamilton as this was a company dealing in Champagne for the Millennium set up by Blee and Rosser with Craig Dean. Blee and Rosser pleaded guilty before the start of the trial. Craig Dean was found guilty.

Details: http://www.sfo.gov.uk/press-room/latest-press-releases/press-releases-2001/craig-dean-sentenced-in-millennium-champagne-fraud.aspx

Marshall Wineries
Marshall was another malt whisky investment company, which also offered Champagne for the Millennium. The trial was held in the first part of 2004. The appropriately named Stephen Jupe was found guilty.

Details
http://www.sfo.gov.uk/press-room/latest-press-releases/press-releases-2004/owner-of-whisky-investment-business-guilty-of-fraud.aspx

Vintage Wines of St Albans
The company offered wines and spirits as investments to Americans, targeting doctors in particular. Four of the five defendants were found guilty in August 2008 – one was acquitted. Two of the four couldn't be named at the time. Shameen Suleman was found guilty, while Stephanie Callebaut pleaded guilty before the trial started. Haroon Khatab also also found guilty but his name had to be concealed until he was later pleaded guilty to an Asian meals fraud. This food fraud also involved a couple of victims of the Vintage Wines fraud.

Details
http://www.sfo.gov.uk/press-room/latest-press-releases/press-releases-2008/vintage-wines-of-st-albans-–-four-sentenced.aspx

Asian food fraud:
http://www.sfo.gov.uk/press-room/latest-press-releases/press-releases-2009/jail-for-bedfordshire-frozen-foods-businessmen.aspx

22nd July 2010: Two jailed for a £7 million “boiler room” fraud

2010-07-23T08:11:00.001+01:00

(Press release from the SFO (Serious Fraud Office)

Two men were sentenced at Ipswich Crown Court today for running an illegal high pressure, share-pushing operation from call centres in Spain. Around 1,250 investors in the UK were persuaded to buy over £7 million worth of shares. Using their “Gordon Gekko” contract notes to complete the transactions, the fraudsters siphoned off around 80% of the invested funds.

David Arthur Vidgeon (DOB 02/01/1980), a UK national resident in Spain was sentenced to seven years imprisonment. Rahul Natwar Patel (DOB 09/09/1975), a UK national resident in Spain was sentenced to seven years imprisonment.

They were found guilty of conspiracy to defraud, contrary to Common Law, on 15 July. Three other defendants, Baldur Sigurdsson, Roland Pibworth (tried in absentia)* and Craig John Clark were acquitted.

SFO Director Richard Alderman said: "A boiler room is a predatory and orchestrated 'attack' on private investors so it's very satisfying to see justice delivered for such callous dishonesty. I hope that publicity of today's outcome will serve as a warning for people to think twice when hard-sell investment offers, usually unsolicited, appear tempting. ‘No’ is the right answer".

Outline

David Vidgeon and Rahul Patel conspired to defraud investors, many of whom were retired and elderly, by high pressure selling of shares in small/obscure companies, with false claims as to their future worth. This fraudulent sales practice was carried out by unlicensed offshore brokerages known as “boiler rooms” under the control and direction of Vidgeon and Patel. The period covered is April 2003 to November 2006.

The lynchpin in the fraud was Vidgeon. He arranged and controlled the deals between the boiler rooms in Spain and the UK companies whose shares they were to sell to unsuspecting investors. Vidgeon obtained these companies through the sourcing activities of an intermediary. Together they supplied several sales operations with companies’ shares to sell. These were based in Spain, one of which was in Barcelona and operated by Rahul Patel. Two other persons suspected of criminal involvement in Patel’s enterprise fled the jurisdiction.

The companies whose shares were sold were worthless. Their function in this conspiracy was as vehicles used by Vidgeon, Patel and the boiler rooms to take not less than 80% of the investors’ money.

One company was Toppurinn UK Ltd, a timber buildings business in the leisure market. It was supposedly planning to enter the steel frame market; at one stage exploring the possibility of becoming involved in supplying to Iraq as part of the US-led reconstruction. This did not materialise.

COL Systems Ltd was another company whose shares were being pushed. Its product “Crime-on-Line”, a concept developed in Iceland, was described as a theft prevention/recovery system for registering property ID references on a central online database. The claim was that it would enable the police to return recovered stolen

property to the owners. The system was said to have been initially piloted in partnership with the Icelandic police and insurance sector but in reality did not achieve commercial viability.

Another company, the Osborn Group, trading as “The Crowd Went Wild”, purported to market sporting memorabilia on the internet. It had no real substance and like “Crime-on-Line” it was simply part of the deception. A template contract note obtained during the investigation was file-named “Gordon Gekko”; an indicator of the business philosophy of the operators. Similar templates were used across all the boiler rooms.

A further four companies were sold by the boiler rooms. None of these companies had any trading activity.

The ‘boiler room’ is a recognised engine of fraud. Boiler rooms are essentially call centres, concerned in the selling of shares on behalf of companies. The selling of shares is an activity regulated by the FSA. Boiler rooms are not authorised and operate illegally, often from abroad.

The ‘boiler rooms’ sell by cold-calling and use hard-sell tactics. The success of their deception is measured not only by the sums of money extracted but also by the nature of the people who were persuaded to part with their money. Even people who believed they were experienced investors were victims of the fraud.

Vidgeon’s own boiler rooms generated in excess of £2.3 million, nearly a half of which he retained, the rest being paid out to other conspirators. Rahul Patel earned more than £960,000 from the operation.

Bank accounts in Spain, Latvia, Cyprus and other overseas jurisdictions were established to help manage the monies received from investors.

Investigation and proceedings

The SFO investigation commenced in May 2005 with support from Norfolk and Suffolk Police. Later that year searches were conducted in several locations within the UK. Searches were also conducted in Spain with assistance from the Spanish Police. Evidence was obtained from eight countries outside the United Kingdom.

The defendants were charged in December 2008. The trial opened at Ipswich Crown Court on 14 April 2010 with HHJ Holt presiding and the jury returned verdicts on 15 July.

In passing sentence, HHJ Holt said “It was a sophisticated and prolonged boiler room fraud and had as victims sensible, ordinary people many of whom lost life savings...An investor buying any of these shares will have a better chance of a return by buying a lottery ticket. You knew this and did not care.”

* Roland Pibworth, who was acquitted, was the founder of Australian Portfolio Wines in Australia.