Kurniawan lawyers seek to omit FBI evidence

Alleged wine fraudster Rudy Kurniawan’s defense lawyers have asked US federal district judge Richard Berman to omit evidence obtained in an FBI search of Kurniawan's LA home due to issues over the legality of the search. As reported on db.com, Kurniawan is working to have evidence of an elaborate laboratory for counterfeit wines in his home excluded from his trial.

His lawyers are to contest the legality of an FBI search of his LA home after his arrest in a Los Angeles suburb in March. Kurniawan appeared at a brief hearing in a Manhattan federal courtroom last week wearing khaki prison clothing and midnight blue tennis shoes, the Wine Spectator reports.

At the hearing, Berman set a schedule for filings by the two sides, which will culminate on 14 November in the defense's expected motion to suppress the results of the FBI's search. During the search, agents found a home laboratory filled with thousands of fake labels dating back to 1899, including all the Bordeaux first growths and fine Burgundies such as Domaine Ponsot.

The operation was fitted out with hundreds of used corks, foil capsules and hardened wax which, when heated, could seal the mouths of bottles. There were also hundreds of rubber stamps for vintage dates, ranging from Château Latour 1899 to Screaming Eagle 1992, and stencils to imprint the names of famous wine estates on wooden cases.

According to a source close to the defense, FBI agents had an arrest warrant but not a search warrant when they entered Kurniawan’s home on 8 March. "It's one thing if you search a person, or a car, but a person's home is sacrosanct. If our motion is granted, and evidence is suppressed, it's a different case,” the source told the Wine Spectator.

"Our motion is being made to ensure that the Constitution is being honored in the letter and spirit in this case. Other than that, we will let our court papers do the talking,” Kurniawan's lead attorney Michael Proctor said of suppressing the search. Kurniawan is being held without bail at a Brooklyn federal detention facility.

NZ rogue trader jailed for wine fraud

Hot on the heels of Rudy Kurniawan, New Zealand rogue trader Simon Mickleson has been jailed after scamming clients out of hundreds of thousands of dollars. As reported on db.com, Mickleson was sentenced last Thursday in Auckland to two years and four months in prison after earlier pleading guilty to 16 counts of fraud. Judge Grant Fraser described the Mickleson as "sophisticated'' and said there was still over NZ$540,000 owed to his victims, a sum never to be paid back as Mickleson was declared bankrupt last week.

Among Mickleson’s vicitms were a top New Zealand auction house and senior figures in the legal industry, including the lawyer to the Todd Property Group, owned by New Zealand's richest family. "Over 20 years of experience and expertise is effectively down the drain,” the disgraced merchant’s lawyer, Grant Illingworth QC, told Auckland District Court. Crown prosecutor Robin McCoubrey said Mickleson deserved a term of imprisonment. 

Mickleson, 43, worked as a wine consultant at Auckland auction house Webb's while running his own business, Fine Wines International. In actions remeniscent of Indonesian wine collector Rudy Kurniawan, who is currently on trial in New York for four counts of fraud, the court heard that Mickleson faked vintages by doctoring wine labels. He also stole credit cards, took money for wine he didn't have, and sold cases of old and rare wines he didn't own for thousands of dollars.

"Some were clients of the auction house, some clients of yours and some were your friends. It doesn't get more serious in terms of a breach of trust than that,'' Judge Fraser said. Webb's managing director Neil Campbell described Mickleson to the New Zealand Herald as "the worst kind of try-hard. Simon had this idea that being perceived as rich and wealthy made you a better person. He was always seeking acknowledgement of prestige and wealth,” Campbell said. 

Mickleson's deceit began in 2007 after he promised Auckland surgeon Jim Shaw NZ$400,000 worth of high-end wines. The wines never arrived and over the next two years he compensated Shaw by taking money from other clients. In October 2007, Hong Kong-based Joong Sheng Giauw paid Mickleson NZ$66,313.08 for 36 bottles of Château Lafite Rothschild 2000 (pictured), which also never turned up. 

In 2008 he asked school friend Julius Fox to help finance a NZ$99,000 order of French wines for Dr Darren Reed, who he claimed owned the private Ascot Hospital. Fox contributed NZ$29,000 but the deal never went through. Investigations revealed there was no such person as Dr Reed. On another occasion, Mickleson changed labels from a case of 2001 Château Lafite to pass the bottles off as the 1982 vintage. He tried to sell 24 fakes for NZ$98,000, but the buyers pulled out after spotting the doctored labels. 

Rudy Kurniawan indicted

Alleged wine counterfeiter Rudy Kurniawan has been indicted by a federal grand jury in New York on four counts and faces extradition to the East Coast state. As reported on db.com Kurniawan was formally accused by the jury of mail and wire fraud to sell counterfeit wine, defrauding a finance company, double pledging collateral, and scheming to defraud a California wine collector and a New York auction house.



The charges were filed by the US Attorney for the Southern District of New York. Kurniawan, 35, has been held at the Metropolitan Detention Center in Los Angeles since his arrest by the FBI on 8 March at his home. According to a source in the US Department of Justice, Kurniawan will be imminently extradited to New York in a government plane by a federal marshal.



The indictment details how Kurniawan, an Indonesian national, allegedly “assisted in the creation of counterfeit wines” in a home laboratory. It describes Kurniawan as a wizard at concocting fake wines by mixing and matching younger, less valuable wines “that mimicked the taste, colour and character of rare and expensive wines.” 



The indictment alleges that during a search of his home, the FBI found evidence of numerous bottles being counterfeited, including a California Pinot Noir that Kurniawan had marked as “40’s/50’s DRC, ” referring to Burgundy estate Domaine de la Romanée-Conti. Agents also found thousands of counterfeit labels for wines dating as far back as 1899, including labels for all the Bordeaux first growths as well as Burgundies such as Domaine Ponsot. 

The home operation was fitted out with hundreds of used corks, foil capsules and hardened wax which, when heated, could seal the mouths of bottles. There were also hundreds of rubber stamps for vintage dates, ranging from Château Latour 1899 to Screaming Eagle 1992. The FBI also found empty bottles of fine and rare wines ready to be filled and “recycled”. Several shipments of empty bottles were mailed to Kurniawan at his request by a New York restaurant he frequented.



Two auctions play a major part in the case against Kurniawan. In April 2008, 22 lots of purported Domaine Ponsot wines were withdrawn at the insistence of Laurent Ponsot, proprietor of the Burgundy estate, from an Acker Merrall & Condit sale. This February, 78 bottles of wine listed as DRC were withdrawn from a Spectrum auction in London. The indictment alleges the wines were fakes, consigned by a paid “straw man” for Kurniawan.



If Kurniawan were to be convicted on all charges, he could face up to 100 years in jail. More likely, according to sentencing guidelines, he would face 87 to 108 months. Asked about his client’s state of mind, Kurniawan’s lawyer, Michael Proctor of Caldwell Leslie & Proctor said: “He’s strong, very strong.”