A well-known wine dealer was
sentenced on Thursday to 10 years in prison for defrauding wealthy clients out
of millions of dollars by selling bottles of purportedly rare wines that were
actually old bottles of wine mixed together.
The dealer, Rudy Kurniawan, 37, had
become a renowned figure in the rare wine scene, spending and making millions
of dollars on wine sales every year.
At a sentencing hearing on Thursday
in United States District Court in Manhattan, Mr. Kurniawan’s lawyer, Jerome H.
Mooney said, “Rudy wanted to be accepted and recognized” by an “elite group of
Burgundy tasters,” adding that his insecurity about his wealth and status got
him caught up in a fraud scheme that went too far.
Mr. Kurniawan sold fraudulent wines
mixed in his home kitchen complete with fake labels to some of the country’s
wealthiest people and leading wine enthusiasts. Mr. Kurniawan was able to make
them believe that his bottles were both real and rare because of his reputation
for an encyclopedic cellar and a finely tuned palate.
“Rudy Kurniawan planned and executed
an intricate counterfeit wine scheme,” said Preet Bharara, the United States
attorney in Manhattan. “Now, Kurniawan will trade his life of luxury for time
behind bars.”
In addition to prison time, Mr.
Kurniawan was ordered to forfeit $20 million and to pay more than $28 million
in restitution to his victims. Mr. Kurniawan, a native of Indonesia who has
been living illegally in the United States, faces deportation after the
completion of his sentence.
Prosecutors made their case using
evidence from a raid of Mr. Kurniawan’s home in Arcadia, Calif. His computer
contained files with scanned images of old wine labels, and bottles were
scattered all around his home.
His clients included the billionaire
William I. Koch; David Doyle, the founder of Quest Software; Andrew W. Hobson,
the chief financial officer of Univision; and others who spent millions on wine
over the last several years.
Mr. Mooney, in arguing for a reduced
sentence, said the impact of Mr. Kurniawan’s crimes was negligible.
“Nobody died,” Mr. Mooney said.
“Nobody lost their job. Nobody lost their savings.”
Judge Richard M. Berman interrupted
him to ask, “Is the principle that if you’re rich, then the person who did the
defrauding shouldn’t be punished?”
Stanley J. Okula Jr., a federal
prosecutor, said it was “quite shocking” that Mr. Mooney was arguing for a
different standard for those who have defrauded rich people. “Fraud is fraud,”
he said. “There is no distinction in the guidelines, or in logic, for treating
it differently.”
Mr. Kurniawan spoke briefly on his
own behalf, saying that he was sorry. The judge also read a letter Mr.
Kurniawan had written to the court, accepting responsibility for his actions.
But the judge seemed dubious about Mr. Kurniawan’s repentance. “I believe he’s
sorry about the position he’s in now,” he said.
Other factors that influenced Judge
Berman’s decision, he said, were the testimonies of three proprietors of French
vineyards, who said that the market no longer had faith in their vintage wines.
Mr. Kurniawan’s actions, the judge said, negatively affected trade relations
between the United States and France.
The defense said it was shocked by
the prison sentence and would file an appeal.
As for all of the expensive wine
that investigators found in Mr. Kurniawan’s cellars, the government is still
trying to figure out what to do with it.
Once the legitimate bottles are
separated from the fake ones, they might be sold. Some people have asked if
they can buy Mr. Kurniawan’s special blends to see if they can tell the
difference.
Said Mr. Okula: “The defendant
approached his victims saying he was selling them a Grand Cru. In reality, he
was carrying out a Grand Con.”
Photo: Ricardo DeArantanha/Los Angeles Times via Associated Press
edited from The New York Times
