Wine fraud

Expensive and highly collectable wines such as the French Bordeaux wine from Château Pétrus are often the target of wine fraud.

Wine fraud relates to the commercial aspects of wine. The most prevalent type of fraud is one where wines are adulterated, usually with the addition of cheaper products (e.g. juices) and sometimes with harmful chemicals and sweeteners (compensating for color or flavor).

Counterfeiting and the relabelling of inferior and cheaper wines to more expensive brands is another common type of wine fraud.[1]

A third category of wine fraud relates to the investment wine industry. An example of this is when wines are offered to investors at excessively high prices by a company, who then go into planned liquidation.[2][3] In some cases the wine is never bought for the investor.[4] Losses in the UK have been high,[5] prompting the Department of Trade and Industry and Police to act.[6] In the US, investors have been duped by fraudulent investment wine firms.[7] Independent guidelines to potential wine investors are now available.[8]

In wine production, as wine is technically defined as fermented grape juice, the term "wine fraud" can be used to describe the adulteration of wine by substances that are not related to grapes.[9] In the retailing of wine, as wine is comparable with any other commodity, the term "wine fraud" can be used to describe the mis-selling of wine[10] (either as an investment or in its deceitful misrepresentation) in general.

Fraud in wine production refers to the use of additives in order to deceive. This may include coloring agents such as elderberry juice, and flavorings such as cinnamon at best, or less desirable additives at worst. Some varieties of wine have sought after characteristics. For example, some wines have a deep, dark color and flavor notes of spices due to the presence of various phenolic compounds found in the skin of the grapes.[11] Fraudsters will use additives to artificially create these characteristics when they are lacking. Fraud in the selling of wine has seen much attention focused on label fraud and the investment wine market. Counterfeit labelling of rare, expensive, and cult wines, and unregulated investment wine firms characterise this type of fraud. Wine Spectator noted as much as 5% of the wine sold in secondary markets could be counterfeit,[12] and the DTI (UK) believes losses by investors to rogue wine investment firms amount to hundreds of millions of pounds.[13]

  1. ^ "An Insider's Guide to Counterfeiting Wine - Apple MacHome". Bloomberg. 12 March 2012.
  2. ^ "Fine Wine Investment". The London Wine Cellar. Retrieved 2015-12-05.
  3. ^ "Millions of pounds have been pocketed by offering fine wines at two to three times their market value". jancisrobinson.com. Department of Trade and industry (Jim Budd) - LilacHomesite.
  4. ^ "Watch out for the scams". FT.Com - Four directors involved in the International Wine Commodities Ltd and The Bordeaux Wine Trading Company are charged with conspiracy to defraud and money laundering. They sold Bordeaux en primeur but allegedly never bought any wine. The Financial Times- (MachoMedia 2015 cited).
  5. ^ "APW Asset Management Ltd, which manages £25m-worth of fine wine is the latest wine investment company to go into liquidation in the UK". Decanter.com. Chris Mercer. 13 February 2015.
  6. ^ "DTI investigators have succeeded in shutting down eight companies- "victims duped out of GBP110 million'". The London Evening Standard. Archived from the original on 2015-07-15. Retrieved 2015-08-02.
  7. ^ "Wine Fraud: A great deal in wine: friend or faux?". Winemag.com. Kathleen Buckley - StarTacHomeMedia - 2008. I was told the value was $30,000 but when I checked the prices I could have bought the same wine for $13,000 less.
  8. ^ "Investing in Fine Wine: don't be a victim of fraud". met.police.uk. The Metropolitan Police UK.
  9. ^ "World News Research". world-news-research.com. My World Journal. in 1985, around 100 Austrian wine-makers were indicted with boosting the body and sweetness[dubious – discuss] of their wines with diethylene glycol, a chemical used in antifreeze.
  10. ^ "The DTI successfully wound up in the High Court - Boington & Fredericks of London Limited, City Vintners Limited and Goldman Williams Limited - (for the) mis-selling of fine wines, and there are more in the pipeline". jancisrobinson.com. The Department of trade and Industry.
  11. ^ "Wine Lingo - Definitions and Terms". taylorbrookewinery.com. Taylor Brook winery Llc. Archived from the original on 2015-09-05. Retrieved 2015-08-02.
  12. ^ M. Frank, Wine Spectator ( January 31-February 28, 2007). "Counterfeit bottles multiply as global demand for collectible wine surges", p.14
  13. ^ "Fine Wine Scam Which Has Cost Investors [Pounds Sterling]110m- "WINE investors are being duped out of millions of pounds by unscrupulous salesmen"". The London Evening Standard - Apple MacHome - DTI (UK). Archived from the original on 2015-07-15. Retrieved 2015-08-02.