Sip On This: That $10,000 (Or $30) Bottle Of Wine Might Be Fake

Oct 13, 2015
Originally published on January 4, 2016 2:35 am

On an early spring day in 2012, a half-dozen FBI agents entered a house in the Los Angeles suburb of Arcadia. It belonged to an Indonesian named Rudy Kurniawan.

According to Maureen Downey, founder of winefraud.com, his home was kept to 55 degrees. "His elderly mother had to have a space heater in her bedroom because it was so damned cold," says Downey. "The entire house was cellar temperature."

Inside the FBI found everything to produce counterfeit wine: corks, dozens of empty bottles and 18,000 labels of the world's rarest wines.

"The whole thing was a wine counterfeiting factory," says Downey.

By the time of his arrest, the then 37-year-old Kurniawan had been living the high life. He had amassed a breathtaking cellar of Bordeauxs and Burgundys and regularly organized tastings of old and expensive bottles for other collectors. At the same time, the FBI says Kurniawan was concocting his own wines in his kitchen and selling them as precious vintages to unsuspecting collectors.

"Take for example one of the most highly counterfeited wines, which is 1945 Domaine de la Romanee Conti Romanee Conti," Downey says. "That wine, they made two barrels of it, which is exactly 600 bottles."

Downey says she's finding counterfeit bottles of it all over the world. A genuine bottle would be worth well over $100,000.

And yet, says Downey, Kurniawan was able to sell much of it: "He would make it to order."

And he fooled plenty of people, selling at least $50 million worth of counterfeit wine.

In 2012, he got caught and was sentenced to 10 years in prison. But counterfeiting still goes on because there are plenty of wine enthusiasts out there willing to part with their money.

"Particularly in the United States there are some fabulous collections which have been painstakingly built up over decades," says Michael Egan, who was the head of wines unit at Sotheby's auction house for more than two decades. He says there are many collectors willing to spend $10,000 to $20,000 a bottle.

"There is a lot of one-upmanship especially in buying rare wines, where there may be just a handful of bottles left or conversely a handful of bottles produced," says Egan.

That demand has driven up the price, and made conditions ripe for counterfeiters. "Some of the wineries like Screaming Eagle in Napa Valley, Calif., produce a very small amount of wine and there's a massive demand for that — there's a waiting list," says Egan. "Obviously that would be a temptation for counterfeiters to produce their own versions of it."

Egan spoke with NPR from his chateau in Bordeaux, France. He says since retiring from Sothebys in 2006, he's been busy authenticating private and corporate collections. So far, he's found about 2,300 bottles of high-priced, fake wine.

But how can you tell if a really old, $10,000 bottle of Bordeaux is real or fake?

"Nobody in the world, nobody, is able to authenticate via taste," says Downey of winefraud.com. "That has been proven over and over again."

Downey says if people could authenticate by taste alone, wine counterfeiting wouldn't be possible. "The problem is, no one has the palate to know what all of these old wines taste like. ... Wine is a living thing and it changes with time."

What you can do, Downey says, is look at the bottle, the labels and the corks for inconsistencies. See if the wines were actually produced the year on the label. (It's harder to fake the newer, fine wines because many are outfitted with anti-counterfeit technology in the labels and bottles, she says.)

But counterfeiters are also getting more sophisticated. If you had been duped, you'd think you want to call the police, grab the counterfeiter and sue. But Frank Martell, director of fine and rare wine for Heritage Auctions, says most collectors want to keep it a secret.

"If somebody tells you $1 million of your collection is worth zero, your choices are take a hit or try and unload the stuff," Martell says. "And nobody wants to take a loss."

That's why counterfeit wines continue to circulate among auction houses and private collectors. But don't think it's just the high-rolling wine enthusiasts who are getting stung by counterfeiters. Martell says some of the $20 and $30 bottles out there are also fake.

"You can produce them in huge quantities and nobody is likely to catch you," says Martell.

Can you make money out of that, though? Martell says that if you figure $50 a case and you move 200 cases, then, yes.

You don't have to spend $10,000 to end up with a counterfeit bottle of wine.

Copyright 2017 NPR. To see more, visit http://www.npr.org/.

DAVID GREENE, HOST:

Hey, Renee.

RENEE MONTAGNE, HOST:

Yes?

(SOUNDBITE OF BOTTLE OPENING)

MONTAGNE: David, are we about to have a glass of wine?

GREENE: Well, I think we should.

MONTAGNE: A little early.

GREENE: There we go. OK, now I'm just fooling you with sound effects. I'm fooling you. I'm sorry. And it actually - it turns out that wine drinkers have been fooled in so many ways. And let's hear NPR's Jackie Northam explore the lucrative world of wine fraud.

JACKIE NORTHAM, BYLINE: On an early spring day in 2012, a half-dozen FBI officers entered a house in the Los Angeles suburb of Arcadia. It belonged to an Indonesian named Rudy Kurniawan.

MAUREEN DOWNEY: His home he had at 55 degrees.

NORTHAM: Maureen Downey is the creator of winefraud.com.

DOWNEY: His elderly mother had to have a space heater in her bedroom because it was so damn cold. The entire house was cellar temperature.

NORTHAM: Inside, the FBI found everything to produce counterfeit wine, corks, dozens of empty bottles and 18,000 labels of the world's rarest wines.

DOWNEY: The whole thing was a wine counterfeiting factory.

NORTHAM: By the time of his arrest, the then 37-year-old Kurniawan had been living the high life. He had amassed a breathtaking cellar of Bordeauxs and Burgundies and regularly organized tastings of old and expensive bottles for other collectors. At the same time, the FBI says Kurniawan was concocting his own wines in his kitchen and selling them as precious vintages to unsuspecting collectors.

DOWNEY: Take, for example, one of the most highly counterfeited wines, which is 1945 Domaine de la Romanee Conti Romanee Conti. That wine - they made two barrels of it, which is exactly 600 bottles.

NORTHAM: Downey says she's finding counterfeit bottles of that wine all over the world. A genuine bottle would be worth well over $100,000.

DOWNEY: And yet Rudy was able to sell so much of it - I mean, really, he would make it to order.

NORTHAM: And he fooled plenty of people, selling at least $50 million worth of counterfeit wine. Kurniawan was sentenced to 10 years in prison. He was the one who got caught, but counterfeiting still goes on because there are plenty of wine enthusiasts out there willing to part with their money.

MICHAEL EGAN: Particularly in the United States, there are some fabulous collections which have been painstakingly built up over, you know, decades.

NORTHAM: Michael Egan was the head of the wine unit at Sotheby's Auction house for more than two decades. He says there are many collectors willing to spend 10 to $20,000 a bottle.

EGAN: There is a lot of one-upmanship, especially in buying rare wines where there may be just a handful of bottles left or there were a handful bottles produced.

NORTHAM: That demand has driven up the price and made conditions ripe for counterfeiters.

EGAN: Some of the wineries, like Screaming Eagle in Napa Valley, Calif., produce a very small amount of wine. And there's a massive demand for that. There's a waiting list. So obviously that would be a temptation for counterfeiters to produce their own versions of it.

NORTHAM: Egan spoke with NPR from his chateau in Bordeaux. He says since retiring from Sotheby's in 2006, he's been busy authenticating private and corporate collections. So far, he's found about 2,300 bottles of high-priced fake wine. But how can you tell if a really old $10,000 bottle of Bordeaux is real or fake?

DOWNEY: Nobody in the world - nobody - is able to authenticate via taste. That has been proven over and over again.

NORTHAM: Downey says if people could authenticate by taste alone, wine counterfeiting wouldn't be possible.

DOWNEY: The problem is no one has the pallet to know what all of these old wines taste like, number one. Number two, wine is a living thing. And it changes with time.

NORTHAM: Downey says you look at the bottle, the labels, the corks. You look for inconsistencies. You check if wines were actually produced the year that's on the label. It's harder to fake the newer fine wines because many are incorporated with anti-counterfeit technology into the labels and bottles. But counterfeiters are also getting more sophisticated. You would think that if you've been duped, you'd want to call the police, grab the counterfeiter, sue. But Frank Martell, with Heritage Auctions, says most collectors want to keep it a secret.

FRANK MARTELL: 'Cause if somebody tells you a million dollars of your collection is worth zero, your choices are take a hit or try and unload the stuff. And nobody wants to take a loss.

NORTHAM: That's why counterfeit wines continue to circulate among auction houses and private collectors. But don't think it's just the high-rolling wine enthusiasts who are getting stung by counterfeiters. Martell says some of the 20 and $30 bottles out there are also fake.

MARTELL: There are people counterfeiting 3 and $4 bottles of wine because you can produce them in huge quantities. And nobody's likely to catch you.

NORTHAM: Can you make money out of that, though?

MARTELL: Well, if you figure $50 a case and you move 200 cases, it's a lot of money.

NORTHAM: So you don't have to spend $10,000 to end up with a counterfeit bottle of wine. Jackie Northam, NPR News. Transcript provided by NPR, Copyright NPR.