Chasing Counterfeits w/ Maureen Downey, Chai Consulting
From being body checked at a La Paulee tasting to responding to detailed questions from noted wine counterfeiter Hardy Rodenstock, Maureen Downey, CEO of Chai Consulting, tells us about the long road to becoming one of the world’s leading experts in wine
From being body checked at a La Paulee tasting to responding to detailed questions from noted wine counterfeiter Hardy Rodenstock, Maureen Downey, CEO of Chai Consulting, tells us about the long road to becoming one of the world’s leading experts in wine fraud. Maureen gives us insight into the global world of wine fraud, what’s being counterfeited now, and how she’s pioneering methods to authenticate wine with The Chai Vault. A must-listen for anybody interested in collecting or investing in wine!
Detailed Show Notes:
- Maureen started in wine auctions in 2000
- Learned about counterfeit wines from a counterfeiter - Hardy Rodenstock asked for a lot of details about bottles that were being sold in auction
- Rudy Kurniawan case - helped track counterfeit bottles, worked with the FBI, and worked with a group of international wine fraud experts
- Counterfeit wine market - it’s in the Billions per year, vast majority sold privately, by brokers, retailers, NOT the auction market b/c auctions are the most visible source of counterfeits
- Estimates 20% of all wine sold is counterfeit - supported by Interpol, consistent with other high-end products
- Lots of IP infringement, low-end wine fraud (e.g., Rose in the South of France)
- Modern trend - counterfeit current, recent production wines
- Most counterfeits come out of Europe (hot spots: Switzerland, Italy, France, & Belgium)
- Asia
- High-end buyers in Asia assume something is counterfeit until proven real
- Flooded with fakes from the US when markets first opened up
- Mainland China - high import taxes leads to the use of “coyotes” (import smugglers) for old and rare wines, and have little recourse for counterfeits
- Hard to know what old wines taste like - even some wine critics tasting notes may be based on counterfeit wines made by Hardy Rodenstock and Rudy Kurniawan
- Main methods of counterfeiting
- Digitally printed, current production wines
- Can re-fill real bottles of wine
- Sassicaia counterfeit ring was recently broken up - they got proprietary glass, capsules and made excellent copies
- There is a big need to track the supply chain to identify and prevent fraud
- Tips for getting real wine as a consumer
- Makes sure retailer has not had problems in the past
- Get to know the people at the wine merchant
- Ask questions and demand answers
- Get to know a consultant and have someone vet the wine first, not after
- Latest information on wine fraud found on Wine Berserkers and winefraud.com
- Systems producers use to protect against fraud
- Prooftag - this is mostly cosmetic, can be digitally printed, and needs proximity to the bottle
- The Chai Vault
- Wines input into blockchain secured system, can be accessed anywhere in the world -> helps with supply chain tracking
- Has an NFC chip underneath capsule that can get read; for secondary market wines, puts a PVC overlay over capsule which cannot be read if the capsule is pierced
- 2nd generation of NFC chip coming out Jan 2021- very low failure rate, better antenna for longer range
- Costs - $8,500 for bottling line additions + pennies per bottle (starting point, costs more money to add transfer of ownership and other features)
- Authentication adds ~20-30% to the value of wine (based on Domaine direct auction sales)
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