Welcome or should I say commiserations to new members caught up in the Wine investment scam. Like the whisky investment scam the fraud hinged on the question of price. Most investors received their wine and it is lying in London City Bond but they have paid 2 or 3 times the correct price. It is regrettable that the DTI took so long to close down City Vintners and Goldman Williams and only goes to emphasise the lack of suitable legal machinery to deal with fraudulent companies and individuals in a quick and effective manner.

It is illuminating that none of the wine investment

companies closed down by the DTI had credit card facilities.

Having lost over 20 million sterling in the whisky fraud the

Banks clearly recognised that these companies were

dubious and refused facilities. But they were quite happy to

run their accounts and take a cut of their profits. There's no

morality where banking is concerned.

Turning to the ongoing whisky saga - many of you will

be amazed that the directors of Napier Spirit Company

escaped prosecution. Many like me fear there has been a

cover up. It is common knowledge that certain high profile

figures had connections with the directors of Napier. Were

you invited to Ascot , Henley, the Royal Show or the many

Other exciting outings arranged for Napier investors. If you

have any information please share it with us.

Most banks are still paying out on credit card claims

but time is now very limited. Our opinion is that limitation

runs from when the fraud was discovered since it was

impossible to make a claim before that time. Certain banks

are now trying to avoid liability by arguing that under

connected lender liability time runs against them from the

date of purchase and it is only against the supplier that time

runs from the date of the discovery of the fraud. Lord

Denning would not have taken kindly to the Banks

interpretation. He believed that a judge should always ask

the question, 'If the makers of the Act had themselves come

across this nick in the texture of it, how would they have

straightened it out?' In other words the courts are here to

iron out the creases in legislation.

If you have come across this problem, please contact

me as soon as possible. You only have a few months left

before the real limitation period does run out.

Paul Smith

Fiasco at the FSO

Napier Directors walk away "Scotch Free"

After 5 years of investigation costing tax payers millions of

pounds the S.F.O have decided not to prosecute the directors of Napier Spirit Company for conspiracy to defraud contrary to common law. According to the Solicitor General Harriet Harman OC MP "The S.F.O. consulted Leading Counsel in September 2000 and in January 2001 and he advised that he felt the case would be likely to fail. He considered the evidence available at the time as well as what evidence was likely to become available in the future. Counsel expressed doubts in relation to the strength of the case. Counsel also advised that he felt it was likely that the case would fail on the basis that the defendant could not have a fair trial "within a reasonable time". He took into account existing case law at that time in relation to Article 6 of the European Convention on Human Rights which deals with the defendants right to a fair trial".

In December 1998 we wrote on behalf of our members to the Director of the Serious Fraud Office "It is now two years since Napier Spirit Company was closed down and while we recognise that your investigations do take time and that any fraud case is of necessity a complex matter our members who have lost millions of pounds feel aggrieved at the considerable delay in any action being taken. We have accumulated a considerable amount of "evidence" with regard to the activities of Napier and this is at your disposal if it is of any value". Tony Farries who was leading the investigation into allegations of fraud in relation to investments in whisky visited my office and took a statement from me but did not require to look at the 200/300 cases we had dealt with because "there was sufficient evidence available".

Let us examine just one case - Mr D.s file - we have a first

letter from Napier "I have pleasure in supplying details regarding the opportunities arising in the fast growing spirit investment market. All of these whiskies have been carefully chosen and we feel that each will prove to have excellent investment potential. Current predictions expect a realistic return on capital invested In the region of 15-18% per annum. With the increasing world demand for quality single malts, this figure looks set to rise". After a few phone calls Mr D. was induced to buy 2 hogsheads of "The Macallan" for 7000. Confirming the purchase Napier wrote "May I also assure you that our specialist brokers will act in your best interests to bring to your attention other investment opportunities arising in the future to give you the maximum chance to expand your investment portfolio."

But "The Macallan" wasn't "The Macallan" - it was whisky

produced by Macallan in second or third fill oak casks and used for blending - worth at best 500 per cask. Mr D's case

not unfortunately an isolated case many investors bough

Napier '5 "Macallan.

It is strange that the SF0 successfully prosecuted the

directors of Hamilton Spirit Management Co. yet find

impossible to find sufficient evidence against Napier for the

same scam. The brochures, the documentation, the sale

methods, the malts sold, the letters written, the telephone

sales techniques all were basically similar. The result in both

cases was the same - the directors made money from the

scam the investors lost money. So Stephen Cleeve

Stephen Dunne, Alma Dunne Haley, McConville and Quinn

the main participants in the Napier scam can all sleep easy

tonight knowing they can keep their ill-gotten gains.

Geoffrey Baxter, an investor with Napier who has lost

over 24000 pounds in the scam was apoplectic about this

decision, "In March 1997 I implored the police to go and

arrest the Napier gang who were now operating as

Millennium Spirit Management Company from Pentax

House. They refused and I was told in no uncertain terms

that if I went there and caused a fracas they would arrest

me". He added "How have the authorities allowed the

Napier Gang to walk away scot free having swindled more

than 1000 honest tax paying citizens like myself of millions

of pounds. I demand an explanation".

July 2002 Newsletter

Comment     |     Fiasco at the SFO    |     Glennstewart International--an update

Breaking the web--wine companies closed down as investors lose millions

Rogues Gallery--where are they now

Gleneagles Spirit Management Company--an update

Price Check 2002    |    Share a cask scheme

Lombard Whisky Brokers