BC Ponzi scheme puts a stain on wine investments

BC Ponzi scheme puts a stain on wine investments

BC Ponzi scheme puts a stain on wine investments Vancouver notary public swindles hundreds of investors. Wineries face potential PR backlash.

The B.C. Securities Commission announced Wednesday it had fined a former notary a total of $44 million for operating a Ponzi scheme over a nine-year period revolving around the fraudulent sale of securities to more than 200 unsuspecting investors. Under the impression they were participating in the financing of a winery, Samji used her influence to perpetrate the fraud.

Reflecting on the fine, BCSC commented, “The magnitude and duration of the fraudulent investment scheme and the number of investors affected justify a significant penalty.”

The moral of the story?

An appropriate amount of research and due diligence is required before making any investment.
WP reached out to wine and hospitality expert Billy Munnelly for his views on wine and wine investments. 

“In the case of a new winery, I'd only look at a project that was well funded enough to survive the first ten years,” says Munnelly. And it goes without saying, like any actively managed mutual fund worth its salt, that the winery personnel should have significant industry experience.

When asked where he would invest given an infinite supply of money, Munnelly replied: “Probably California because the industry understands marketing better than anyone else. Chile has a lot going for it including skills, climate, diversity and a conservative government.”

Entrepreneurs and investors interested in opening and funding a new winery might want to consider existing businesses as templates for the future. Right in Munnelly’s backyard (Prince Edward County) is Sandbanks Winery. He considers it a good model, “because it has good marketing, delivers crowd-pleasing wines, and the winery experience for visitors is fun and non-intimidating.”

We suggested wine might be a better investment than a winery. “There are cases where people have made money in wine,” says Munnelly, “but I think the odds are even worse than at the race track. Those who make money know the business inside out – they are professional punters.” So, that’s a no.

At the end of the day Munnelly says, “Wine is for drinking, and relieving the stress of your other investments.”

Cheers to that sentiment.
  • Andrewski 2015-01-23 12:43:42 PM

    Here is the Court's decision:

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