First Champagne investment trial opens

Published: 23 July, 2008

by Jim Budd

A thousand victims were duped by a sophisticated fraud into buying over-priced Champagne as a Millennium investment from the House of Delacroix, believing that they would make 35% per annum over three years. Instead, in the end many investors paid 22 per bottle for Champagne that retailed at 12. Craig Dean (35) is accused of conspiring with Julian Blee (32) and Lee Rosser (31) to defraud. Blee and Rosser have already pleaded guilty. Richard Lissack QC, Dean's defence, has accepted that Delacroix was fraudulent but that Dean "was not a party to it". The trial began on 23 January and Southwark Crown Court has been hearing from Jonathan Fisher, prosecuting, how the three men "cynically exploited the quite widespread hype that there would be insufficient Champagne for the celebrations at the end of 1999"; how Delacroix made a gross profit of about 2.1 million, selling 2.5 million worth of Champagne that cost the company just 450,000. On average, Delacroix paid the equivalent of 5 a bottle for the Champagne. Delacroix sold Champagne Lantz from Debruyne in Szanne and also from Michel Arnould in Verzenay. Blee and Rosser set up Delacroix in late March 1996 and Dean was "involved from the very start". The three had met while working with Hamilton Spirit Management Ltd in Gibraltar, selling casks of whisky as an investment. Delacroix was registered in the Dutch Antilles with two nominee director companies registered in Panama. The main office was in Amsterdam. However, investors were led to believe that Delacroix operated from a prestigious Parisian address. Dean is alleged to have taken over the running of the company in March 1997 until he left Amsterdam in September 1997 to set up Helmsley Trading and Marketing on Madeira. Delacroix was wound up in 1998. Delacroix claimed falsely that the Champagne retailed at 30, that they had a total of 15 years' experience in the wine and spirits trade and that there would be a special Millennium auction around September 1999. The use of false names was widespread. Dean's was Oliver Portman. Typical is the experience of one investor from East Yorkshire, who paid 2,880 for a "Grand Millennium" pack of 192 bottles of Lantz Champagne in June 1996. Once Delacroix disappeared he had to pay a further 1319.67 to have his Champagne delivered, raising the price to 21.87 a bottle. The trial is expected to last three weeks.

NB: Find out about drinks investment deals by visiting www.investdrinks.org * Thirty UK fine wine companies have now pledged not to supply knowingly the claret web and other "dubious" wine investment companies

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