Photo: Jaime Hogge
Ricardo DeAratanha/Los Angeles Times/Polaris
Fraud
DAVID MALAMED In Vino Veritas
and a finely tuned palate,” said The New York Times. The man who unmasked the California-based fraudster was
not happy with the sentence, despite its harshness. “Twenty years would have been more satisfactory, considering how he has sullied the image and integrity of the wine appellations of Burgundy, Bordeaux and beyond,” French wine expert Laurent Ponsot told The Telegraph. “Kurniawan gave the entire planet the impression that falsifying wine can make you a whole lot of money, so the sentence had to be very, very severe.” Ponsot told the newspaper that he began a crusade to expose
Kurniawan in April 2008. Ponsot had been told that 97 bottles from his estate, which is one of the most illustrious in Burgundy, were up for auction in New York. He attended the sale unannounced and, upon seeing the
W
INE,” ERNEST HEMINGWAY SAID, “is one of the most civilized things in the world.” That may very well be true, but the recent victims of
possibly the biggest wine fraud in history might beg to differ. In August 2014, 37-year-old Rudy Kurniawan, considered one
of the leading wine collectors in the world, was sentenced to 10 years in prison by a US District Court in Manhattan for having defrauded wealthy clients out of an estimated US$20 million by selling them falsely labelled wine over more than a decade. He was also fined US$20 million and ordered to pay US$28
million in compensation to his victims. “Never before had such a severe punishment been meted out for such a crime,” The Telegraph noted. The Indonesian-born businessman (who was living illegally in
the US and faces deportation aſter his sentence has been served) was “famed for his palate and ability to identify fine wines,” reported the paper. “But it emerged he had been blending the contents of cheap bottles in the kitchen of the home he shared with his mother,” and applying fake labels onto the bottles. His well-heeled client list — which included American billionaire William Koch (who has a wine cellar of 43,000 bottles); David Doyle, the founder of Quest Software; and Andrew Hobson, the CFO of Univision — believed they were purchasing extremely rare and expensive wines. “Kurniawan was able to make them believe that his bottles were both real and rare because of his reputation for an encyclopedic cellar
56 | CPA MAGAZINE | MAY 2015
details of the bottles, informed the auction house that some had to be fakes. “The consignment included one bottle of 1929 Ponsot Clos de la Roche, which the domain did not produce under its own label until 1934,” The Telegraph said. “Also for sale were 38 bottles of another Ponsot grand cru, Clos Saint-Denis, from the years 1945 through 1971. But the winery had not started making Clos Saint-Denis until 1982.” As soon as Ponsot pointed out these discrepancies, the
auction house withdrew all the Ponsot bottles. The next day, Ponsot had lunch with Kurniawan, whom he found to be evasive. “I knew he was a crook from the moment I set eyes on him,” Ponsot says. “He was ill at ease, stared at his plate and wouldn’t meet my gaze.” Ponsot was determined to bring Kurniawan to justice, but it
would take years and several hundred thousand dollars of his own money, which he spent on private investigators. His efforts, which he coordinated with the FBI’s art theft
unit, resulted in a March 2012 raid at Kurniawan’s home, where they found, among other evidence, about 19,000 fake labels from some of the most sought-aſter wines from Burgundy and Bordeaux, as well as aged corks. During the subsequent trial, Kurniawan’s lawyer managed to aggravate Judge Richard M. Berman by arguing that his client, who had used his fraudulently obtained money to live an exces- sively lavish lifestyle, had ultimately caused negligible harm and deserved a lenient sentence. “Nobody died,” his lawyer said. “Nobody lost their job. Nobody lost their savings.” To which Judge Berman asked: “Is the principle that if you’re
rich then the person who did the defrauding shouldn’t be punished?”
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