Scale of Côtes du Rhône wine fraud “massive”

The scale of France’s Côtes du Rhône wine fraud scandal last year is larger than first thought, with new figures revealing that as many as 66.5 million bottles of wine were counterfeit.

Original estimates for the scam that began in 2013 and which was uncovered last year, suggested that the amount of fake wine was around the 40 million bottle mark.

The scandal revolves around bulk wine trading company Raphael Michel, which is accused of rebottling and labelling cheap red table wine as premium wine, specifically Côtes du Rhône and Chateauneuf-du-Pape.

The bottles were sold for as little as £15 (around $21) and, in some cases, for as much as £100, with many bottles reaching European countries including the UK.

The company, which sources wine from more than 4,000 growers in the Rhone Valley, Provence, Languedoc-Roussillon and South America, has been under investigation since last year after French customs officials found discrepancies and potential violations during a routine audit.  

Raphael Michel’s chief executive Guillaume Ryckwaert was arrested last June on charges of fraud, deception and violations of France’s consumer and tax codes, and accused of masterminding the wine fraud racket. He has denied any wrongdoing.

According to French authorities, which have called the scam “a massive misuse of the Côtes du Rhône label”, 15 per cent of the annual output of the label between 2013 and 2016 is believed to have been counterfeit, equating to around 50 million litres or 5.33 million cases, Harpers Wine and Spirit reported.

Meanwhile, an additional 10,000 hectolitres – about 1.3 million bottles – was sold as fake Chateauneuf-du-Pape, the publication said, citing France’s consumer anti-fraud agency, the Direction Generale de la Concurrence, de la Consommation et de la Repression des Fraudes (DGCDRF).

The cheap table wine that Raphael Michel is accused of using would, under normal circumstances, have a price tag of no more than £5, highlighting the extent of the mark-up generated from the fraud.

Investigators believe the fake Chateauneuf-du-Pape alone netted Raphael Michel around €7m.

Ryckwaert took over the business in 2003 and saw sales increase by up to 30 per cent a year.

No winemakers from the Rhone region have been implicated in any wrongdoing. However, they have argued that the scandal has damaged the image of the region and their brands and have joined the civil case against Ryckwaert.

If found guilty, Ryckwaert faces up to two years in prison and a $370,000 fine.