The National Fraud Intelligence Bureau (NFIB) wishes to remind investors that fraudsters are still active and are using various methods to dupe victims into investing in fine wine.
Whilst it might be easy to identify a fraudulent investment in non-existent fine wine, there is another tactic which is much harder to detect that relies on limited knowledge of the investor in this specific area.
In many cases, the fraud relates to the value of the wine as opposed to the existence of the wine. Therefore, fraudsters will be able to prove to the victims that they have the wine in stock, however the wine in stock will be significantly cheaper than the inflated price the fraudsters ask the victims to pay.
Whilst it may look like a 'real deal', the dramatically inflated prices make the promise of any returns unrealistic.
Assessments of reports show that fraudsters charge victims an average of 47% more than the comparative market values at the time of sale.
The brokers who typically cold call victims boast that an increasing market in China will guarantee tax free profits. When questioned about risk, fraudsters will convincingly say that it is "extremely low".
How to protect yourself against investment fraud
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