Two days ago, the firm was shut down by the High Court after being in provisional liquidation since the start of January.
Founded in 2008 by sole director and shareholder, Kenneth Gundlach, the firm has been operating a money-making scam by selling wine up to three times its value to the public and using pushy sales and cold-calling tactics to reach targets.
According to reports, Bordeaux Fine Wines paid the ‘Wolf of Wall Street’, Jordan Belfort, to give a motivational seminar for £50,000.
During the investigation, The High Court heard the company’s turnover was £45 million with only £200,000 worth of wine saved for investors. After ordering the company to go into compulsory liquidation, Mrs Registrar Derrett said the director ‘appeared to treat the company account as his own bank account’.
There have been a number of stories in the press about families affected by the scam with many cold-callers who were only paid on commission having little information about the investments they were selling. They ripped off vulnerable people by persuading them to invest in something that wasn't even there to go towards life savings and retirement.
Partner David Greene of law firm, Edwin Coe, supported the creditors (whom were owed £3 million) during the liquidation process and commented, ‘We are pleased to see that the court has made a compulsory order because this is a situation which needs investigating immediately.’
What is compulsory liquidation?
This is where the company is wound up and all assets are sold into cash and equally paid out to creditors. In this case, the High Court or government wound up the company using a winding up petition under public interest due to the nature of the investigation. The director will likely be facing very serious legal actions himself too.