60 Minutes correspondent Sharyn Alfonsi explains the elaborate scheme that roped in American billionaire wine collector Bill Koch. Bill Koch is the lesser known brother of political activists, Charles and David Koch. Bill split with the family business and used his money to collect valuables, including a vast amount of wine. Some of that wine though, was fake. Alfonsi writes (abridged):
As long as there have been collectors, there have been people trying to cheat them. The world of fine wine is no different. Forgers have made millions of dollars fooling collectors thirsty for rare and interesting “trophy” wines. With lots of money, big egos and often no intention of ever drinking the wine, they’re an easy target.
At first, no one seemed to be an easier mark than Bill Koch, an avid wine collector with deep pockets. He is the sibling of the famous Koch brothers, Charles and David, who are known for their philanthropy and support of conservative causes.
Koch is a billionaire whose money comes from his family. His father, Fred Koch, founded the Kansas-based oil and gas conglomerate, Koch Industries, now the second wealthiest privately-owned business in the country with annual revenues of over $100 billion.
Bill Koch was fired from the company, after he tried to gain control of it. He sued his brothers Charles and David for his share and went on a multimillion dollar spending spree, collecting not just art, but trophies – including the America’s Cup in 1992 – and a cellar full of the finest and rarest wine in the world.
His finest wine and those most desired by collectors are from centuries-old chateaus in the Bordeaux and Burgundy regions of France. Bottles with an interesting backstory fetch especially high prices. Christie’s auction house sold one bottle supposedly owned by founding father Thomas Jefferson for a record price of more than a $156,000.
In 2005, Koch decided to include a photo of one of his prized Jefferson bottles in an exhibit of his collection. Koch asked Brad Goldstein, his private investigator — when you’re a billionaire you have one — to reach out to historians at Thomas Jefferson’s home, Monticello.
Monticello historians told them Thomas Jefferson didn’t have his wine bottles engraved and this is not his signature.
Koch dispatched his private investigator, Brad Goldstein, to Germany — to track down Hardy Rodenstock, a wine spectator cover boy and collector who claimed to have discovered the Jefferson bottles. Rodenstock wouldn’t talk to Brad Goldstein, or 60 Minutes for that matter. But there was someone who was prepared to talk to Koch’s private eye about wine forgery; a man who said he had crafted fake labels for Hardy Rodenstock for years.
Bill Koch traced more than half of his 400 fake bottles to this man — a wine dealer in Los Angeles named Rudy Kurniawan….
In 2012, the FBI raided Rudy Kurniawan’s home in California where he was blending high-end wine with cheaper wine and rebottling it behind expensive labels.
Rudy Kurniawan made tens of millions of dollars fooling wealthy buyers. He was convicted and sentenced to prison for 10 years.
Read more here.