Star Indonesian Wine Dealer Guilty in US Fraud Trial

Jakarta Globe – AFP, December 19, 2013

The entrance to the Federal Court building in NEw York on Dec.
10, 2013. (AFP Photo/Stan Honda)

Star wine dealer Rudy Kurniawan was found guilty of fraud in a US court Wednesday for manufacturing fake vintage wine, in a stunning fall from grace that could see him jailed for 40 years.

A jury took less than two hours to return a guilty verdict on two counts of wire and postal fraud against the 37-year-old, once considered one of the top five wine collectors in the world.

The Indonesian-born Kurniawan, who for years lived a jet-set lifestyle with all the trappings of a millionaire, sat impassive in the Manhattan courtroom as the verdict was read out.

Prosecutors described him as “a prolific wine counterfeiter” and an arch liar motivated by greed, a man who made millions of dollars selling bogus vintages blended in his kitchen laboratory.

The defense portrayed an outsider who desperately wanted to fit into the richer, older world of rare wine collectors.

In custody since his arrest in March 2012, he will be sentenced on April 24.

The court heard how Kurniawan rose rapidly to the top of his profession thanks to his exceptional palate, capable of identifying and memorizing the world’s finest wines so popular with tycoons.

But prosecutors said his penchant for fast cars, designer watches and contemporary art collections was built on an elaborate and years-long lie.

They said he sold at auction and direct to collectors more than 1,000 fake bottles blended in his kitchen or “magic cellar” to masquerade as vintage wines worth thousands of dollars.

“This was an operation on a massive scale,” said prosecutor Joseph Facciponti, summing up at the end of the seven-day trial.

“He sold wine to victims all over the world. For a while the magic worked and he sold his fake wines for millions of dollars, but there was no magic, only the defendant’s lies,” he said. “Why did he tell all his lies? Because of greed, that’s what this case is about, the defendant’s lies and his greed.”

In 2006, two auctions in New York that offered Kurniawan wine fetched $35 million.

In the first auction, clients purchased 39 lots that contained counterfeit wines for a total of nearly $1.3 million, wine expert Michael Egan had told the trial.

He said he had examined 1,433 counterfeit wines since 2006 from seven clients, of which 75 percent were from Kurniawan.

Thousands of labels for the finest Burgundy and Bordeaux wines were found in the home that Kurniawan shared with his Chinese mother in Arcadia, on the outskirts of Los Angeles.

There were full bottles waiting to be labeled. Investigators also found intricate formulae on how to concoct vintage–tasting wine by blending a mixture of far cheaper wines.

The allegations against Kurniawan surfaced over an April 2008 auction in New York where he had offered 97 purported bottles of Domaine Ponsot for sale for between $440,500 and $602,000.

But French expert Laurent Ponsot, of the acclaimed Domaine Ponsot winery, became suspicious and flew to New York to ensure that auction house Acker Merrall & Condit withdrew the lot.

After allegedly trying to sell more dubious wine at auction in London via an intermediary in 2012, Kurniawan was arrested.

“He wanted to be part of the club,” defense lawyer Jerome Mooney had argued before the court.

In buying thousands of bottles of great vintage wine each year, it was inevitable that there would be fakes among them, given the rampant availability of counterfeit wine, he had argued.

“Should he be doing that?” said Mooney. “Probably not. He was not doing it to defraud people.”

Agence France-Presse