USA CHARGED TWO BRITS FOR USD100M FINE WINE SCAM THRO’ A HONG KONG COMPANY
By Susan Lewis
Credit: Damian Chou/Unsplash
Two British men have been charged in New York for allegedly defrauding people through a Hong Kong-registered company into investing nearly USD100 million in loans supposedly backed by expensive wines that did not exist.
According to the indictment announced yesterday, Stephen Burton, 55, and James Wellesley, 57, were charged with wire fraud, wire fraud conspiracy and money laundering conspiracy through a loan scheme conducted through the Hong Kong-registered Bordeaux Cellars Ltd and the UK-registered Bordeaux Cellars London Ltd.
Court papers showed that Bordeaux Cellars claimed to have thousands of fine wines, including wines from Domaine de la Romanee-Conti in Burgundy and Chateau Lafleur in Bordeaux, in their custody from high-net-worth money borrowers.
Between June 2017 to February 2019, they allegedly duped investors into lending out USD100 million and promised to pay them regular interest payments from the rich borrowers, while Bordeaux Cellars would keep custody of the wines when the loans were outstanding.
It was said that the high-net-worth burrowers and the fine wine collateral were actually non-existent, Burton and Wellesley used loan proceeds to make fraudulent interest payments to investors or for personal expenses.
“These defendants duped investors by offering them an intoxicating investment opportunity collateralised by valuable bottles of fine wine that turned out to be too good to be true,” U.S. Attorney Breon Peace in Brooklyn said in a statement.
Wellesley was arrested on 4 February in the UK, Burton remains at large and is considered a fugitive.
Wellesley was previously jailed for conning a bank out of millions to fund extravagant life style.
If found guilty, the pair could face up to 20 years in prison.
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