Wine storage fraudster William Holder of Safe Harbour Wine Storage in Maryland has been sentenced to 18 months in federal prison for illegally selling on his clients’ wines.
As reported by Wine-Searcher, on 31 July Holder was also ordered to pay restitution of US$1.5 million to his victims and will be supervised for three years after his release from prison.
According to court documents, Holder sold on a large number of wines customers paid him to store at Safe Harbour in Glen Burnie, a suburb of Baltimore, to wine brokers and retailers.
He was selling hundreds of bottles at a time of the most expensive wines stored at his warehouse, making tens of thousands of dollars on each sale.
Holder, whose wine storage business is now defunct, used to funds to fuel his gambling and opioid addictions and repay loans taken on keep his business afloat. He had also been working as a Lyft driver (the US equivalent of Uber) to supplement his income.
According to Wine-Searcher, Holder pled guilty to only one count of federal wire fraud for attempting in 2017 to sell 216 bottles of wine to a Napa-based broker for US$11,800.
One victim of the fraud, Christopher Aronovici, lost five cases of wine worth aroundUS$12,000 stored with Holder.
“It’s really surprising how many people he got to,” Aronovici told the Washington Post of Holder’s fraudulent scheme, which last five years.
Another, Todd Laubach, lost 759 bottles of wine through the scam, including 2005 Bordeaux, Barolo, Domaine du Pegau and Clos des Papes Châteauneuf du Pape.
“These victims felt betrayed. They placed their trust, and they feel like that trust has been seriously violated,” assistant attorney Martin Clarke said at Holder’s sentencing.
This incident is the latest in a long line of wine fraud stories. In April a group of fraudsters that were involved in a £1 million wine investment scam were jailed for a combined total of 17 years after being sentenced at Southwark Crown Court in London.
The five men operated three fake companies called Mayfair Worldwide Trading Ltd, Commodex Global Limited and Winchester Associates Ltd. Each company claimed to be fine wine brokers operating out of glitzy London locations such as Berkeley Square in Mayfair. The businesses were instead registered in an industrial state on the outskirts of Great Dunmow in Essex.