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Wine fraudster’s conviction ‘tip of iceberg’

© Photo: AFP

Video by Jessica LE MASURIER , Emmanuel SAINT-MARTIN

Text by Sophie PILGRIM

Latest update : 2013-12-21

A gripping New York trial this week of Indonesian wine dealer Rudy Kurniawan has revealed a troubling culture of turning a blind eye to counterfeit goods among fine wine-makers and auctioneers.

Kurniawan amassed a fortune by duping the likes of William Koch and other wealthy collectors into buying bottles of ordinary wine for tens of thousands of dollars.

He was portrayed by the prosecution during the trial as a cunning trickster who got off on duping rich collectors, fiddling with empty bottles and glue in his makeshift kitchen workshop to create a finished product that would deceive both buyers and auctioneers. But details from the trial revealed cracks so wide in the protection of the industry, critics say it is impossible to place the blame on Kurniawan alone.

A 37-year-old Indonesian who moved to the US when he came to study in California in 1995, Kurniawan showed little emotion during the 10-day trial, during which details of his counterfeit operations revealed an entire persona built around his wine-tasting abilities.

“He certainly had a good pallet,” winemaker Laurent Ponsot, whose wines Kurniawan counterfeited and whom he met over lunch, told FRANCE 24. “He was also a show off. He loved to entertain and to spoil his guests.”

Kurniwan sold off fake wines for some eight years before FBI agents called at the LA home he shared with his 67-year-old mother. It was then they discovered the makeshift “laboratory” in his kitchen.

“Hundreds of bottles, innumerable corks, printed labels, glue... There was wine-making stuff everywhere,” FBI agent Timothy Rembijas, who investigated the case, told FRANCE 24. “You wouldn't even want to live there.”

Rembijas said that neither Kurniawan nor his mother seemed surprised when the agents turned up. “It was almost as though he was expecting us,” he said.

Kurniawan made at least $1.3 million between 2004 and 2012 (the FBI estimates profits running into the millions). In 2006 alone, he sold some 12,000 bottles of fake wine.

Winemaker Laurent Ponsot, whose wines Kurniawan counterfeited. Photo: Sophie Pilgrim/ FRANCE 24.

Ponsot, who brought Kurniawan’s activities to the attention of the authorities after being sent a photograph of 84 counterfeit bottles supposed to have come from his Burgundy estate, told FRANCE 24 that he felt it was impossible for Kurniawan to have produced so many products by himself.

“There’s no way he was acting alone,” he said. “There must have been another lab somewhere, which has since been destroyed by one of his collaborators.”

Kurniawan’s lead attorney believes he was made into something of a scapegoat. “Rudy was cast as the nemesis of the wine business,” Jerome Mooney told FRANCE 24. “In reality, counterfeits are rampant in this business. As soon as he was arrested, his so-called friends all disappeared.”

For some, the extent of complicity runs as far as into the auction houses that sold Kurniawan’s fake bottles.

“Auctioneers are either incompetent or complicit,” fine wine expert Maureen Downey told FRANCE 24. “These guys don’t want to lose face, and quite honestly, they don’t want the game to end; they want to keep the party going.”

Ponsot believes the same is true for his fellow winemakers. When he launched his crusade to have Kurniawan exposed, he received little support from his colleagues. “They didn’t want to know; they were enjoying the glory,” he said. Ponsot admits that until he realised the extent of the problem, he too dismissed counterfeiting as harmless. “At first you feel proud, you take it as a compliment,” he said.

A more obvious incentive for winemakers, dealers and auctioneers is the inevitable increase in price driven by sales.

Those buying the wines are the only ones set to lose out, and, in most cases, they will never find out.

“Scammers play on the fact that old wines can be bad due to exposure to oxygen,” Ponsot explained. “When you buy a $10,000 bottle of wine, you have no idea if it will be drinkable or not.”

“Besides,” he added, “in most cases these are trophy wines which will never be opened.”

Ponsot says the police are as equally indifferent. “The French authorities didn’t want to help me,” he said. “I fought this battle by myself.”

FBI agent Rembijas said that in the United States, he believes the FBI is the only law enforcement agency to have investigated counterfeit wines.

Rembijas said that part of the problem is a lack of pity from the public. “This isn’t a cause that many people will sympathise with,” he said. “The victims in these cases have all spent thousands of dollars on wine. People aren’t going to worry about them too much.”

One of those victims is William Koch, whose Tea Party-funding brothers make his case all the less sympathy-inducing.

The industrialist says he purchased 219 bottles of Kurniawan's wine for $2.1 million. Suspicion over some of the bottles led him to hire private investigators, who traced the fake bottles back to Kurniawan.

Koch was furious that he had been “cheated” and set out on his own crusade against fake wines. He says he has spent $25 million investigating fraudulent wine around the country.

But Koch’s efforts will have to expand a little further afield if he is hoping to make any lasting impression on the industry. The emergence of Asia as a major new wine-producing and consuming region has already seen an increase in counterfeit products in European and American markets.

“Kurniawan is just the tip of the iceberg,” Rembijas said. “With Asia becoming a big player, this problem is going to get much, much worse before it gets any better.”

Date created : 2013-12-21

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