Investors can be left with a painful financial hangover from fine wine investments, as in the case of Bordeaux Fine Wines Limited.. But is there any way to recover your money?
Wine investments, land banking and carbon credits are increasingly being used by fraudsters to target potential investors through cold calling techniques and using aggressive sales tactics.
Jo Swinson, former Consumer Minister, commented on the carbon credit scams: "This is a particularly disgraceful scam as it not only preyed on older people trying to maximise their savings, but also targeted their sincere desire to make ethical investments. Instead, investors have been left out of pocket with shares that are either worthless or do not exist."
Action Fraud, the UK's fraud reporting centre, believes £1.2 billion is lost every year to these types of investment scams in the UK.
With the popularity of investing in wine on the increase, as an alternative to trusting a volatile stock market, many investors are falling foul of these predators. The Wine and Spirits Trade Association (WSTA) provides advice for consumers looking to invest in wines.
But what can be done if you have already fallen victim to an investment scam or fake wine investment company?
Getting your money back
The Fraud Insolvency Division (FInD) at Grant Thornton UK LLP works closely with the victims to understand if there is potential to seek recourse. Fees are conditional upon recoveries made and therefore victims will not need to fund recoveries and spend further money throwing 'good' money after 'bad'.
You can read more on our Fraud Insolvency Division page. FInD specialise in tracing and recovering assets from multiple jurisdictions. For example, the team has recently recovered monies for victims of various investment scams, including off-plan property developments, mortgage, insurance fraud and other boiler-room frauds, in the UK, Spain, Caribbean, USA, the Middle East, Panama and other overseas jurisdictions.
FInD works with various police fraud squads, the National Crime Agency and the Crown Prosecution Service, and is currently running over 600 asset recovery cases.
If you believe you have been a victim of a fraud/scam and would like to understand if we can help please get in touch.
Investigating a fine wine scam
In a recent case a wine investment company was placed into liquidation and a partner of the FInD team was appointed liquidator. Following extensive enquiries and legal action the team were able to trace wine held in the company's name, which was located in various bonded warehouses. The sale of this wine provided realisations totalling approximately £500,0000, which enabled a dividend to be paid to creditors. As a result of tracing and selling this wine, FInD has established strong relationships with a number of the key bonded warehouse in the UK.
During FInD's investigations into the company's financial affairs all bank accounts were thoroughly investigated. A detailed forensic analysis of the accounts identified a number of large and unusual transactions that did not appear to have been made in the normal course of business or otherwise for any legitimate purpose. Solicitors were instructed in relation to pursuing the repayment of these finds and claims have been brought against any third parties, where necessary.
Following investigations into the directors' actions and subsequent reports to the Insolvency Services, disqualification orders have also been made against both directors disqualifying them from acting as directors for 12 years.
Bordeaux Fine Wines liquidation
UK-based wine investment company, Bordeaux Fine Wines, is a high-profile case where investors have lost significant amounts of money.
Bordeaux Fine Wines was placed into formal liquidation at a hearing on 26 February 2014 on the grounds that "it is expedient in the public interest on the basis it is just and equitable for it to be so" under Section 124(a) of the Insolvency Act. The petition brought by the Department for Business, Innovation and Skills was supported by four creditors with claims totalling some £2,582,000. The Registrar further commented: "It is clear from evidence before me that they [Bordeaux] did not purchase sufficient wine to fulfil orders."
David Ingram of Grant Thornton UK LLP, was subsequently appointed as Liquidator of the company. All known creditors were invited to submit a claim in the liquidation. Total claims agreed exceeded £41m and creditors received a final distribution of their claims in March 2017. There are no further funds available for distribution. However, should you wish to register your claim or require further information please contact Jackie Stringer or Kiran Olgun on the details listed below:
Register your details:
Recovery Room Scam Warning – Important Notice
Fraudsters are cold calling creditors claiming to act for the Liquidator. We have been made aware that a number of investors have been approached by parties purporting to work for Grant Thornton UK LLP in an attempt to extract money with the promise to then release their wine or to pay a dividend. Please be aware the Liquidator will never ask for a tax or fee to release the wine or instruct a third party to do so.
David Ingram has extensive experience in the investigation, tracing and recovery of assets arising from wine and similar boiler-room type frauds. David made the following comments regarding Bordeaux Fine Wines Ltd:
"The scale of losses by investors in Bordeaux Fine Wines Ltd is shocking. I have spoken to several investors and am appalled by the sums involved. Many of the investors that I have spoken to have lost very significant sums of money, which would have otherwise been used to secure a retirement that was not reliant upon State hand-outs. Bordeaux Fine Wines has changed that for many people, ruining what should be a contented retirement. I would like to assist in the exercise in getting a return to those victims and believe that FInD is the best qualified team to fulfil this ambition."