Over the last few years fine wine fraud has gone from something that was sometimes quietly discussed in the back rooms of the leading auction houses to front page news. Recent cases of involving fakers such as Rudy Kurniawan have made headlines around the world as investors and collectors find themselves holding millions of pounds worth of fake, worthless wine.
The reasons behind the escalation in the levels of wine fraud are relatively simple and include:
• Prices – the prices of fine wines have gone through the roof in the past couple of decades. For example, I remember selling cases of Petrus 1982 to a Far East customer in 1999 for £10,000 a case. The same wine would now cost you somewhere in the region of £45,000 a case
• Investment potential – as we all know the financial markets have been on a rollercoaster ride since 2008 and volatility still abounds. Fine wine is seen as a sound investment by many, and with the Liv-Ex 100 beating the FTSE 100 by several percent on average since the late 1990s, it's not hard to see why there are no lack of ready buyers
• Lack of knowledge – investors know the names, they know the labels and they may even know the investment history of these wines, but what they often don't know is what they actually look like in the flesh. Investing in fine wines often involves buying en-primeur or buying wines under bond. In such circumstances, the owner will often not actually see the wines they are buying until they arrive. Indeed, in many cases the wines are reduced to the level of a commodity that is simply traded on and never sees the light of day. This leaves a massive opportunity for fraud as if a wine is described as laying in bonded warehouse, under bond and in its original wooden case then proper inspections may only be carried out when it's too late, if at all
• Technology – early fakes were often all-too-easy to spot. Plain capsules without chateau branding were used, facsimile labels and even silly mistakes such as spelling Romanée Conti as Romanée Conte were found in a hoard in China. But as the prices have risen and as technology has moved on, so making high-quality fakes has become easier – albeit to the untrained eye
For all the stories of fake wines and the rise of the fakers, the vast majority of fine and investment quality wine is reliable and makes for a sensible long-term investment. To help you stay safe when buying fine wine, here are WinePro's top tips for avoiding the fakers:
Always buy from a reputable source – if you met a man in a pub and he offered to sell you a Rolex would you buy it? Of course, you wouldn't; you'd automatically assume - probably quite rightly – that it was either a fake or stolen and the same applies to fine wine. Before you buy always check out the seller's reputation. The internet makes researching wine companies easy and if you are speaking to them on the phone or dealing with them face-to-face then ask about their trading history, where they bond and who they trade with. At WinePro, for example, we bond with Vinothèque, at London City Bond where all the wines we list are held, we have been trading since 2005 and have a wine lineage that dates back to the 1970s.
• If in doubt, ask an expert – fakes are getting better alas, but there are tell-tale signs a wine may be faked if you know what to look for. Light bottles, inferior paper weights for labels, non-contemporary fonts and ink colours – a real give away on older wines - can all be red flags if you know what you are looking for, so if in doubt ask an expert.
• Looks too good to be true? It probably is – wine auctions sites are littered with wines that look like bargains, but are they really? To use the Rolex analogy again, if you saw a new Rolex Daytona on eBay for £5,000 would you buy it? It's a £15,000 watch so the chances are your suspicions would be aroused. It's the same with wine. If someone offers a bottle of Romanée Conti 1999 for £5,000 you have to ask why that person was offering it at half the market value. Ignorance? Desperation? Or something more sinister…
• Check the wine's provenance – asking a merchant where they got a wine should be standard practice and they should have no issue telling you and providing paperwork to support it. Famously the controversial wine seller, Hardy Rodenstock, has forgotten which Paris-based merchant he bought the famed Jefferson bottles from, an unfortunate lapse of memory that has fuelled the controversy over the bottles for years. A wine broker obviously won't reveal the source of the wine until the deal is done, but if you play safe and buy from a merchant who owns all the wines they sell – as WinePro does – then you can track the wine's heritage.
• Double-check when buying the top ten – the following, according to WineFraud.com, are the world's most faked wine. So, when looking at these wines it's worth double checking the provenance and getting some expert help.
The short answer to that is yes; with the caveat that you take sensible precautions such as using a trustworthy merchant, asking the right questions and, especially when buying old and rare wines, get some expert advice.
If you'd like to get some help with buying fine wine, then please feel free to get in touch with the WinePro team. You can call us on (0)7725 643772 or click here to send us an email.