Rudy Kurniawan

Rudy Kurniawan
Born 1976
Jakarta, Indonesia[1]
Residence Arcadia, California
Other names "Dr. Conti"
Ethnicity Chinese Indonesian[2]
Criminal charge Wine fraud, mail fraud[3]
Criminal status Convicted[4]

Rudy Kurniawan (born 1976, in Jakarta, Indonesia) is a wine collector (called in 2007 the possessor of "arguably the greatest cellar on Earth")[5] and convicted perpetrator of wine fraud. He was arrested on March 8, 2012 and indicted for allegedly selling fraudulent wine at auction. Allegedly, Kurniawan was buying large stocks of negociant Burgundy and re-labeling them as more expensive wines, such as Domaine de la Romanée-Conti.[6] He famously consigned several lots of Clos St. Denis from Domaine Ponsot from vintages long prior to any recorded production of Ponsot wines from that vineyard; the auction lots were withdrawn prior to bidding.[3][7]

Background

Kurniawan attended California State University, Northridge in the late nineties,[8] arriving in the US on a student visa around 1998.[9] His Chinese father reportedly gave him an Indonesian last name to help him maintain "autonomy".[8] It has been claimed that his alphabetized Chinese name is Zhen Wang Huang.[6] In 2003, U.S. Immigration and Customs Enforcement ordered Kurniawan to submit to a voluntary deportation; he elected to stay in the United States as an illegal alien.[10]

Kurniawan began buying and selling large amounts of rare wines in the early part of the 2000s,[11] spending as much as $1 million a month buying auction lots by 2006.[9][12] At the same time, he began hosting tastings of rare wines with other collectors; he showed so much affinity for the expensive Burgundy producer, Domaine de la Romanée-Conti, at these events that he became known as "Dr. Conti".[6] Eventually, he wound up consigning lots to 2 major auctions at Acker, Merral & Condit in 2006, netting $10.6 million ($12.4 million in 2016 dollars)[13] in the first and $24.7 million ($29 million in 2016 dollars)[13] in the second.[3] The second auction was the record for a single sale of wine at auction,[14] beating the previous record by more than $10 million.[5] During the two auctions, Kurniawan offered for sale 8 magnums of 1947 Château Lafleur.[15] A few days after the second sale, Kurniawan secured a loan for $8.84 million ($10.4 million in 2016 dollars)[13] from Acker Merrall & Condit, secured by the wine and art in his collection.[9]

In April 2007, Kurniawan consigned several magnums of 1982 Château Le Pin at Christie's in Los Angeles; the bottles were featured on the auction catalog's cover. Representatives from Le Pin contacted the auction house and indicated that the bottles were fake; Christie's withdrew the lot from auction after further review of the bottles.[16] At the 2007 TASTE3 food and wine conference held in Napa, California, David Molyneux-Berry, the former head of the wine department at Sotheby's, noted that only five magnums of the 1947 Lafleur were produced, indicating that Kurniawan's wines sold in 2006 were assuredly fakes.[15]

In 2008, Kurniawan consigned several bottles allegedly made by Domaine Ponsot from the Clos St. Denis Grand Cru appellation, with vintages ranging from 1945 through 1971. According to Laurent Ponsot, head of Domaine Ponsot, the domaine had never made a Clos St. Denis prior to 1982. Ponsot contacted the auction house, and the alleged fake lots were removed.[7] Ponsot later met with Kurniawan and was left wondering if Rudy was a counterfeiter, or simply the last person to innocently handle counterfeited wine.[6] Kurniawan, when asked after the auction lots were withdrawn where the wine came from, said "we try our best to get it right, but it's Burgundy, and sometimes shit happens".[7] He also arranged for a $3 million loan for himself from Emigrant Savings Bank in January 2008, secured with art and wine that had been previously promised to Acker, Merrall & Condit.[1][15] After the Ponsot sale was called off, Kurniawan's luck had almost entirely run out. Bill Koch filed a lawsuit against him in 2009, alleging Kurniawan knowingly sold fake bottles to him and other collectors, both at auction and privately.[6][17][18] He also defaulted on a $10 million loan from the auction house Acker, Merrall & Condit, where he sold much of his wine, including the withdrawn Ponsot sale.[1][15][19] In February 2012, Spectrum Wine Auctions had to withdraw several lots of wine, worth an estimated $785,000,[20] from an auction in London when allegations emerged that they were consigned by Kurniawan through a second party.[1][16][21]

Arrest

On the morning of March 8, 2012, the FBI arrested Kurniawan at his home in Arcadia, California.[22][23] When agents searched his house, they found inexpensive Napa wines with notes indicating they would be passed off as older vintages of Bordeaux, corks, stamps, labels, and other tools involved in counterfeiting wine.[6] He was indicted on several counts of mail fraud and wire fraud in New York on March 9.[3] Later investigations indicated that Kurniawan was purchasing inexpensive, though old, Burgundy wines and re-labeling them with prestigious producer names and vintages.[6]

Prosecution

Kurniawan's indictment was updated on April 8, 2013, consolidating the fraud charges, and adding two new charges—one for selling a faked jeroboam of Château Mouton-Rothschild 1945 in 2006 for $48,259 ($56.6 thousand in 2016 dollars[13]) and one for selling six bottles of Domaine Georges Roumier Bonnes Mares 1923 at a 2006 auction for $95,000 ($112 thousand in 2016 dollars).[13][24] Domaine Georges Roumier did not produce wine prior to 1924, according to lead prosecutor Jason Hernandez, ergo the 1923 bottles must be fakes.[25]

The initial court date for the criminal hearing was set for September 9.[24] Due to the court date conflicting with the harvest period for wine grapes in the Northern hemisphere, on May 6, 2013, the judge decided to allow three witnesses (Aubert de Villaine of Domaine de la Romanée-Conti, Christophe Roumier of Domaine Georges Roumier, and Laurent Ponsot of Domaine Ponsot) to testify before trial on videotape, as they would be unavailable to appear in Manhattan at that time.[25]

Kurniawan's trial began on December 9, 2013,[26] and concluded on December 18, 2013, when the jury found him guilty and sentenced him to 10 years imprisonment.[4][27][28] As of January 2015 Kurniawan is a prisoner at a United States Correctional Institution located in Taft, California with a planned release date of November 23, 2020.[29]

Victims

Alleged victims of Kurniawan's fraud include Bill Koch, who sued Kurniawan in 2009 alleging he sold fake bottles at auction and in private sales—specifically, a 1947 Château Pétrus, a 1945 Comte Georges de Vogüé Musigny Cuvée Vielles Vignes and two bottles of 1934 Domaine de la Romanée-Conti that were sold at the first of Kurniawan's two auctions in 2006. Koch and Kurniawan settled out-of-court in July of 2014 for $3 million in damages, and Kurniawan should be completely debriefed regarding his knowledge of counterfeiting in the wine industry.[30] Edward Milstein of Level 1 Entertainment, who purchased Kurniawan-consigned lots at auction, alleges he purchased fakes as well.[11][15] Emigrant Bank, which Milstein's family owns, had Kurniawan default on $2.3 million in loans.[15] Acker, Merrall, & Condit was still owed, as of February 2012, almost $3.5 million from their loans to Kurniawan.[1] Pedro "Cuiaba" Neves, who bought dozens of Matariki wines. In January 2015 the contents of Kurniawan's personal wine collection was examined for non-fake wines that can be sold to help repay his victims.[31][32]

References

  1. 1 2 3 4 5 "Sealed Complaint in United States of America v. Rudy Kurniawan" (PDF). Retrieved 4 July 2012.
  2. ↑ MICHAEL STEINBERGER (July 2012). "A Vintage Crime". VANITY FAIR. Retrieved 22 April 2016.
  3. 1 2 3 4 Wallace, Benjamin (13 May 2012). "Château Sucker". NY Magazine. Retrieved 2 July 2012.
  4. 1 2 Peter Hellman; Mitch Frank. "Accused Wine Counterfeiter Rudy Kurniawan Guilty in Landmark Case". Wine Spectator. Retrieved 20 December 2013.
  5. 1 2 Bloomberg Markets 18: xlix. Missing or empty |title= (help);
  6. 1 2 3 4 5 6 7 Steinberger, Michael (July 2012). "A Vintage Crime". Vanity Fair. Retrieved 2 July 2012.
  7. 1 2 3 Hellman, Peter. "Domaine Ponsot Proprietor Halts Sale of Fake Bottles". Wine Spectator. Retrieved 4 July 2012.
  8. 1 2 Brown, Corie (December 14, 2006). "Wealthy wine collector creates class of his own". Lodi News Sentinel. Retrieved 7 July 2012.
  9. 1 2 3 Hellman, Peter (30 June 2012). "Play Hard: Work Harder". Wine Spectator: 74. Retrieved 14 July 2012.
  10. ↑ "Rudy Kurniawan Bail letter". New York Times. Retrieved 7 July 2012.
  11. 1 2 Fleming, Mike. "Level One’s Bill Todman Jr, Edward Milstein To Make Film About Wine Fraud Who Sold Bogus Bottles To Milstein". Retrieved 2 July 2012.
  12. ↑ Brown, Corie (1 December 2006). "$75,000 a case? He's buying". LA Times. Retrieved 4 July 2012.
  13. 1 2 3 4 5 "Consumer Price Index (estimate) 1800–". Federal Reserve Bank of Minneapolis. Retrieved November 10, 2015.
  14. ↑ Hellman, Peter. "Alleged Wine Counterfeiter Rudy Kurniawan Indicted". Wine Spectator. Retrieved 4 July 2012.
  15. 1 2 3 4 5 6 IRELL & MANELLA LLP: Layn R. Phillips, Bruce A. Wessel, Melissa R. McCormick. "Koch v. Kurniawan: COMPLAINT FOR FRAUD, NEGLIGENT MISREPRESENTATION, AND VIOLATION OF CALIFORNIA UNFAIR COMPETITION LAW" (PDF). Retrieved 4 July 2012.
  16. 1 2 Steinberger, Mike. "The Return of Rudy Kurniawan?". Wine Diaraist. Retrieved 4 July 2012.
  17. ↑ Frank, Mitch; Hellman, Peter; Gaffney, Jacob. "Billionaire Sues Major Collector". Wine Spectator. Retrieved 4 July 2012.
  18. ↑ McCoy, Elin (2 July 2012). "Wine Sleuth Sniffs Out Fakes, Takes Hammer to Lafite". Business Week. Retrieved 2 July 2012.
  19. ↑ Hellman, Peter; Frank, Mitch (15 December 2009). "The Crusade Against Counterfeits". Wine Spectator. Retrieved 4 July 2012.
  20. ↑ Blankstein, Andrew (9 March 2012). "Influential L.A.-area wine collector accused of fraud". LA Times. Retrieved 4 July 2012.
  21. ↑ Hellman, Peter. "Bogus Burgundies?". Wine Spectator. Retrieved 4 July 2012.
  22. ↑ Fleming, Olivia (15 May 2012). "The $1.3m wine hoax: How one man sold cheap Napa plonk as the world's finest vintage... and fooled the industry elite". Daily Mail. Retrieved 4 July 2012.
  23. ↑ Hellman, Peter. "FBI Arrests Wine Collector Rudy Kurniawan". Wine Spectator. Retrieved 4 July 2012.
  24. 1 2 Hellman, Peter (10 April 2013). "Rudy Kurniawan's Court Date Is Set". Wine Spectator. Retrieved 1 July 2013.
  25. 1 2 Hellman, Peter (8 May 2013). "Top Burgundy Winemakers Will Testify Against Alleged Counterfeiter". Wine Spectator. Retrieved 1 July 2013.
  26. ↑ Hellman, Peter. "Prosecutors Reveal Evidence Against Accused Wine Counterfeiter". Wine Spectator. Retrieved 20 December 2013.
  27. ↑ http://www.fbi.gov/news/stories/2014/september/rare-wine-dealer-sentenced-in-counterfeiting-scheme
  28. ↑ Gardiner, Sean; Sharp, Sonja (August 7, 2014). "Counterfeit Fine-Wine Dealer Sentenced to 10 Years". The Wall Street Journal.
  29. ↑ "Find an inmate - Rudy Kurniawan". U.S. Federal Bureau of Prisons. Rudy Kurniawan, Inmate number 62470-112, Age: 38, Race: Asian, Sex: Male, Located at: Taft CI, Release Date: 11/23/2020
  30. ↑ Mercer, Chris (25 July 2014). "Kurniawan to 'tell all' in $3m settlement with billionaire Koch, as sentencing is delayed". Decanter.com. Decanter. Retrieved 5 August 2014.
  31. ↑ Mercer, Chris (17 December 2014). "Rudy Kurniawan's private cellar could help to repay victims". Decenter.com.
  32. ↑ Shaw, Lucy (December 18, 2014). "Kurniawan’s wines will be sold to repay victims". thedrinksbusiness.com.

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