Counterfeit Wines on the Rise

A recent headline screamed that 20% of wine was counterfeit.  The question is, 20% of what?

Counterfeit wines are not a problem for mere mortals like most of us.  It is the bane of über wealthy collectors who know their wineries and vintages and are tempted by a prize such as rare bottle of Chateau Cheval Blanc or a Château Pétrus.  These wines command phenomenal prices at auction, or through private sale, in the many thousands of dollars per bottle.

We reported in early November about an Italian father and son team passing off 400 bottles of a top burgundy – Domaine de la Romanée-Conti – worth about $2.7 million.  Recently, an Armenian immigrant was sentenced to four months in prison in Bordeaux for selling fake Chateau Mouton Rothschild labels on eBay.  When police searched his apartment in Paris, they found 8,000 wine labels in his cellar.  Many of the forgeries come from China, which seems to be rife with fake high-end wines being sold to uninformed and unsuspecting wealthy Chinese.

So how do the counterfeiters manage to pass off fake wine?  There are as many schemes as there are fraudsters.  One way is to buy up empty old bottles of various prime vintages, which are sometimes available on eBay or through other sources.   That gets them to first base then they meticulously copy the labels, the foil and the corks.  It is a lot of work but it pays well!  Recently Rudy Kurniawan, a well-known collector, was found guilty in a Manhattan federal court of selling $1.3 million worth of counterfeit wine.  He could get up to 40 years in the slammer.

Until recently, the industry has been reluctant to acknowledge the problem, specifically in France, so as not to undermine the confidence of the market.  And what collector wants to own up to being duped?  But things are changing.  Billionaire collector Bill Koch (he has at least 43,000 bottles in his cellar) has been suing auction houses where he has spent millions, including for fake wines. Shining a light on the dark side of wine collecting is the best way to alert producers, middlemen, auction houses and collectors to take steps to prevent fraud and prosecute the perpetrators.