Table of Contents:
- Biggest wine hoax in history reveals trade secrets
- Genie out of bottle
- The genie is out of the bottle for the rare wine industry. The Koch-Greenburg case and Rudy Kurniawan's trial of the century are setting up to reveal the moldy secrets of the fine wine trade.
The wine rumors were always there. Whispers and suspicion over various vintages were a constant. But the dollar values kept climbing, the band kept playing, and the swirl of doubt was kept to a low murmur. Hazy origins and intrigue — the mystique of rare wine.
In reality, the mystique of the rare wine trade was masking a crumbling facade and the day of reckoning has come — maybe a year of reckoning. Two trials will play out in 2013, and both promise to keep the wine industry riveted on every detail, with evidence that will expose the proliferation of counterfeit wine. The financial stakes of the cases and potential reverberations are stunning: In 2000, global wine auctions brought in $92 million; in 2011, global wine auctions hit $478 million. Those lofty days may be over, toppled by the biggest wine hoax in history.
The first trial, a civil case presently undergoing jury selection in a Manhattan, N.Y., courtroom, features billionaire Bill Koch vs. tycoon Eric Greenberg. Koch is suing for $300,000 over fake wines that he bought from Greenburg through an auction house. Greenburg is denying culpability and says the wines came with a "buyer beware" legal tag. Both men have spent millions in pre-trial legal fees, and Koch has been tagged as a maniacal "Captain Ahab," with Greenburg as his white whale. Billionaires fighting in a $300G Moby Dick battle would normally amount to comedy, but not in this case. The ramifications could be tremendous. As the New York Daily News states, "The trial figures to unveil what has been a moldy secret in the ritzy wine auction world — the proliferation of phony bottles that make it to market and are sold to unwitting buyers with money to burn."
The Koch-Greenburg case will have even more significance because it plays directly in to what may be the wine industry's trial of the century — the Rudy Kurniawan criminal case expected later in 2013. In his mid-20s, Kurniawan, an Indonesian national, slipped into the rare wine scene out of nowhere and within eight years had pulled off the biggest charade in wine history. Starting in 2002, Kurniawan began hitting wine auction houses and splashed out millions — buying, buying and buying. With an air of mystery and bravado, he was helping to inflate rare wine prices that had no ceiling. According to Vanity Fair, "In 2006, having helped push prices to vertiginous heights, Kurniawan began selling enormous quantities of wine." He made tens of millions in profits from rare wine finds that stunned all of the industry elite. By his late 20s, Kurniawan was the darling of the fine-wine world.
But what Kurniawan sold often wasn't what it appeared. He was simply taking vintage wine bottles and refilling them with various cheaper wines, and he did it on an assembly line scale. From his house, Kurniawan worked his deceit with sealing wax, rubber stamps, old bottles, photocopied labels and corks aplenty — and the low-brow approach fooled all the high-brows. For eight years, no one would dare say that the emperor had no clothes. If Kurniawan's wines tasted odd, they were merely "inconsistent."