Investment company Bordeaux Fines Wines has crashed with debts of more than £2.5 million and left collectors trying to get their money back high and dry.
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The company was forced into liquidation by the High Court after action from the Department for Business, Innovation & Skills on the grounds of public interest.
Four creditors were chasing debts totalling £2.58 million, but liquidators expect many more owed a lot of money to emerge.
The court said the company had ‘clearly not purchased enough wine to fulfil orders’.
A meeting of creditors is scheduled for March 14 at the offices of the official receiver in London.
Financial firm Grant Thornton has been appointed to liquidate Bordeaux Fines Wines.
Bordeaux Fines Wines is accused of running a scam to defraud wine collectors out of their cash.
David Ingram of Grant Thornton said: “The losses in this matter are shocking. I have spoken to a number of investors and I am appalled by the huge sums of money involved.
“Many of the investors have lost their life savings which were earmarked for funding their retirement.”
Ingram revealed more than 600 recovery cases are underway to find cash and other assets from fraud cases.
In one case, not connected to Bordeaux Fine Wines, wine held by fraudsters was traced to several bonded warehouses.
The sale of this wine raised £500,000, which enabled a liquidation dividend to be paid to creditors.
Unregulated investment scams like wine collecting, land banking and trading carbon credits are becoming increasingly popular as retirement savers look to boost their income for their later years.
Their typical tactics involve cold-calling, emails and harassing investors to part with their cash.
Consumer Minister Jo Swinson said: “These disgraceful scams prey on older people trying to maximise their savings and their sincere desire to make ethical investments. Instead, their bank accounts are raided leaving them out of pocket with investments that are either worthless or do not exist.”
Action Fraud, the official government agency monitoring scams, believes £1.2 billion is lost every year to investment frauds in the UK.
Earlier this month, police swooped on ‘boiler room’ fraudsters in Britain, Spain, Serbia and the US, making more than 100 arrests and recovering luxury sports cars and £500,000 cash after a two year undercover intelligence operation.
Most of the arrests were in Spain, where fraudsters worked out of 14 offices.
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