The Kurniawan Saga Continues

Yet more amazing stories have come out of the Rudy Kurniawan wine faking trial in the US. Kurniawan was finally sentenced recently for faking millions of dollars worth of rare wine: he got 10 years in jail, and has to pay an awful lot of money to those he swindled.

According to reports on Bloomberg, Kurniawan (pictured in sketch above on the left) swindled collectors including sometime Sydney resident and Rockpool Bar & Grill co-owner David Doyle by selling them more than US$20.7 million worth of fake French wines. He concocted them in his home using faked labels and other packaging materials. Billionaire William Koch was another he swindled.

Said Bloomberg, US district judge Richard Berman in Manhattan imposed the sentence, saying Kurniawan, 37, had failed to accept responsibility from his crimes. Judge Berman ordered Kerniawan to forfeit property to the value of US$20 million including jewellery, art, real estate and wine. He was also ordered to pay US$28.4 million to collectors who bought the fake wines. A jury convicted Kurniawan last December of mail and wire fraud. It took until August 8 for him to be sentenced.

Kurniawan’s lawyer, Jerome Mooney, sought a sentence of 2 ¼ years, representing the time Kurniawan has served in US custody since his 2012 arrest. Kurniawan is the first person in the US to be prosecuted for selling fake wines and his crime should be viewed in perspective, Mooney said.

“Nobody died here,” Mooney said. “Nobody lost their savings, nobody lost their job, nobody was rendered devoid of the things they needed for their life.”

A key victim was David Doyle, co-founder of Quest Software and later, a restaurateur with a $40 million cellar. Doyle paid US$15.1 million and transferred an Aston Martin car for wines that included a supposed 1947 Chateau Cheval Blanc, according to prosecutors.

At least 1,590 bottles, which would be worth more than US$19 million if genuine, were fakes, Doyle’s estate manager said in a memo to the judge.

The government won Judge Berman’s approval to seize all Kurniawan’s property, including art by Damien Hirst and Donald Judd, luxury watches worth more than US$550,000 and a US$33,600 south sea pearl necklace.

The trial included testimony from three French winemakers who travelled to the US to testify.

Most disturbing is the revelation that Kurniawan’s fakes have infiltrated the wine market and may be sold at auctions for decades to come, according to the prosecutors. It’s another blow to the confidence bidders will have in the fine wine auction market.

I recall interviewing Doyle in Sydney in July 2009 with the following quotes. Doyle was emphatic that provenance was important to him. This is part of the story I wrote.

How does he buy his rare wines? “From the reputable auction houses, Sotheby’s, Christie’s, Acker Merrill in New York. They source a lot of great stuff and steer me away from stuff that might be dodgy. You have to have a relationship with them. They have information: you just have to ask.”

On provenance: “In Australia, you do not always have great provenance. I only buy from people I know, and I only ship at certain times of the year. It doesn’t matter what the label is, if the provenance isn’t good, it could be rubbish.”

Amen to that. 

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