Crimson Fine Wines – two directors banned 20 years in total

 

Craig Cooper and Jefferey Kushner, the two directors of Crimson Fine Wines Ltd, which was closed in the public interest on 17th August 2015 in the High Court in London, have been banned from acting as directors of UK companies for a total of 20 years. 

The company was incorporated was incorporated on 21st February 2011 with Craig Cooper and Jeffrey Kushner as directors. Cooper was only very briefly a director resigning on 23rd March 2011. However, as Kushner is resident in Canada, it was Cooper who ran the company. 

 

Crimson's explanation of the advantages of wine investment:

Crimson Fine Wines investment pitch did indeed turn out to be a 'story' with unfortunate investors owed £989,258 in unpurchased wine. 

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Press release from The Insolvency Service:

'Directors’ conduct in fine wine investment scam leaves sour taste 

Two directors of a company that traded in fine wines have been disqualified for a combined 20 years, following an Insolvency Service investigation. 

Customers who thought they were investing in fine wines investment scheme have been left out of pocket by nearly £1 million.

The investigation by the Insolvency Service found that Crimson Fine Wines Limited, based initially in London and then in Sittingbourne in Kent, used cold calling tactics and then failed to purchase or allocate wines to customers who had paid for their investments. The scheme offered investors returns over 12 months to five years, at a time when they claimed the property market and shares were less attractive.

The Secretary of State for Business Energy and Industrial Strategy accepted disqualification undertakings from Craig Cooper and Jefferey Kushner, preventing them from acting as directors for 11 and 9 years respectively.

Kushner was the listed director of Crimson Fine Wines Limited but lived in Canada, and allowed Cooper, who had previous experience in the industry, to run the operation.

As a result of this failure, at the time of liquidation of Crimson Fine Wines Limited there was insufficient wine held in the bonded warehouse to satisfy customers’ claims.

Additionally, Cooper used the company’s bank account for his own personal benefit, used his own personal bank account for the receipt of company funds and was paid at least one third share of £114,106 in dividends. Kushner was negligent in failing to monitor the company account, allowing it to be used for non-commercial benefits, but also received at least one third share of £114,106 in dividends.

Customer claims in the liquidation totalled £989,258, of the overall debts on liquidation of £1,080,724.

Karen Jackson, Official Receiver, said:

One of the main purposes of the Company Directors Disqualification Act is to ensure proper standards of conduct of company directors are maintained and to raise those standards where appropriate.

These disqualifications should serve as a reminder that the Insolvency Service will investigate unacceptable conduct by company directors.

The Insolvency Service will take action against directors who do not take their obligations seriously and abuse their position.

Notes to editors

Jeffrey Kushner’s date of birth is December 1980 and he resides in Ontario, Canada.
Craig Cooper’s date of birth is January 1983 and he resides in Chatham, Kent.

Crimson Fine Wines Ltd (CRO No. 07537346) was incorporated on 15 January 2008 and latterly traded from Sears Business Centre, 3-9 Station Street, Sittingbourne, United Kingdom, ME10 3DU.

Cooper was initially appointed as the company’s co-director with Kushner from incorporation on 1 February 2011. Cooper then resigned as a director at Companies House on 22 March 2011 but continued to act as a director until the company went into liquidation on 17 August 2015. The estimated deficiency at the date of Liquidation was £1,080,724.

On 18 July 2017, the Secretary of State accepted a Disqualification Undertaking from Craig Cooper, effective from 8 August 2017, for 11 years.

On 25 May 2017, the Secretary of State accepted a Disqualification Undertaking from Jeffrey Kushner, effective from 15 June 2017, for 9 years.

A disqualification order has the effect that without specific permission of a court, a person with a disqualification cannot:

• act as a director of a company
• take part, directly or indirectly, in the promotion, formation or management of a company or limited liability partnership
• be a receiver of a company’s property

Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.
Persons subject to a disqualification order are bound by a range of other restrictions.'

 

Nouveau World Wines Ltd: six arrested in wine investment scam

Six people were arrested today by fraud squad officers investigating a wine investment scam.

Two women aged aged 40 and 32 and four men aged 40, 65, 30 and 34 were held during raids in east and south east London. One of those arrested is understood to be 34 year-old Daniel Snelling.

The move came after Scotland Yard detectives were alerted to a large-scale specialist wine fraud. Investigators believe victims have handed over thousands of pounds to invest in specialist Australian wines. Once the money was taken the “investors” were told the wine had been laid down to increase in value as it aged, but it did not exist.

Detective Chief Inspector Robin Cross, who leads the fraud squad, said the arrests followed a lengthy inquiry, codenamed Operation Iceman.

 

The senior officer said: “This kind of investment fraud is becoming far too common. People from all economic backgrounds are being targeted and persuaded to invest in what appears to be a sound financial opportunity.

"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.”

The arrests were made at two business address and several homes in Docklands, Sidcup and Bexley. The six were being held at an east London police station on suspicion of money laundering offences.It is understoond that they have now (5th March) been released on police bail.

Set up in September 2004 Nouveau World Wines Ltd offered Australian boutique wines as an investment – often powerful Shirazes. Wines sold to investors included 2007 Molly Dooker Carnival of Love Shiraz, 2005 Two Hands Aphrodite and 2005 Greenock Creek Alice's Shiraz. 

As well as London offices Nouveau World Wines Ltd claimed to have offices in Hong Kong and Melbourne, Australia. 

On NWW's website, which has now been taken down, the company explained that: 'all the fine wines from Nouveau World Wines are sourced through out wine regions across the new world market, namely Australia, Argentina, California, Chile, South Africa and New Zealand. Each vine yard comes with a good trading history in fine wine. The wines are mostly stored in reputable bonded warehouses in perfect storage conditions or stored at the original point of production within in the vine yard. Most wines are available in original wooden cases unless stated.'

Wine investment companies offering Australian wine have a poor history. Australian based Heritage Fine Wines and Wine Orb both collapsed spectacularly in 2005.   

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This is a combined report sourced from a Press Association report by Chris Greenwood, Press Association's crime correspondent from story on Kent News ­www.kentnews.co.uk

www.kentnews.co.uk/kent-news/Fraud-squad-arrest-eight-for-alleged-wine-scam-newsinkent33446.aspx?news=local
+ With my additions on 5th March 2010.

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My comment 

So far the company involved has not been named nor have those arrested. I have, however, received a number of messages recently from concerned investors who had bought various Australian wines for investment and who were having difficulty contacting the company. 

I'm delighted to see further evidence that the police forces are now taking wine scams seriously. I remain amazed that so many people are prepared to invest in something they probably know little about from companies they know even less. It is not as though the sums are small I have been contacted by people who have written cheques for over £100,000 for wines that never existed – all on the basis of a cold call!

I'm particularly pleased to see police action in the lead up to the 2009 Bordeaux en primeur campaign, which will surely be heavily hyped and demand for the top wines may well out strip demand. En primeur, where you pay for wine two years before it is delivered is a brilliant bespoke vehicle for potential fraud.