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Massive Rhône Valley Wine Fraud Reported by French Authorities

108,000 cases of fake Châteauneuf-du-Pape among the alarming details to emerge in Raphaël Michel fraud case
Grapes in Châteauneuf-du-Pape fetch a far higher price than the ones that allegedly went into Raphaël Michel's wines.
Photo by: istockphotos
Grapes in Châteauneuf-du-Pape fetch a far higher price than the ones that allegedly went into Raphaël Michel's wines.

Suzanne Mustacich
Posted: March 19, 2018

Between October 2013 and June 2016, Raphaël Michel, a bulk-wine merchant in France's Rhône Valley, allegedly sold the equivalent of 13 Olympic-size swimming pools of cheap French table wine while claiming it was some of the best wine of the Southern Rhône Valley.

Those details and more emerged with the release of the annual report of the DGCCRF (Directorate General for Competition Policy, Consumer Affairs and Fraud Control), France's powerful anti-fraud agency. While the report does not name Raphaël Michel, the details match precisely with the investigation first reported last July by Wine Spectator. Independent sources confirm that Raphaël Michel is the unnamed company in the report.

According to the DGCCRF report, between 2013 and 2016, the merchant sold around 20 million liters of table wine—the equivalent of 2.23 million cases—as more lucratively priced appellation-level wines including Côtes du Rhône, Côtes du Rhône-Villages and even 108,000 cases of Châteauneuf-du-Pape.

When investigators dug deeper, the scam grew even larger, encompassing even more kinds of wine. "In total, the fraud touched more than 48 million liters of wine," reads the report. That is the equivalent of 5.33 million cases of fake wine, 15 percent of the Côtes du Rhône production during those years.

Investigators were first drawn to Raphaël Michel during a tax audit, then the DGCCRF began inspecting the wine operation more closely. That was when they discovered, among other discrepancies, a vat marked AOP Châteauneuf-du-Pape—worth about $862,000—which was not in fact wine grown in this prestigious appellation.

On June 27, 2017, Raphaël Michel chairman Guillaume Ryckwaert and other managers were taken into custody. Two days later, Ryckwaert was charged with fraud, deception and violations of the consumer and tax codes. He was released on a $1.2 million bail (later reduced by half) and forbidden from working with the company.

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

The case is particularly troubling because Ryckwaert was considered something of a wunderkind of the bulk-wine world. Raphaël Michel sources wine from its own vineyards as well as 15 cooperatives. It also has significant operations in Provence, the Languedoc-Roussillon and abroad in Argentina and Chile.

Thanks to a free-trade agreement between Chile and China, Raphaël Michel had stepped up its shipments to China from its base in Chile. Raphaël Michel also owns a massive wine platform in Italy called Oenotria-Cluster, which stocks bulk wine of different varieties and qualities from New World nations such as Chile, Australia and South Africa, and acts as a one-stop shop for international buyers.

Last year, following Ryckwaert's arrest, the company reported debts of €20 million and sought protection from bankruptcy courts. This winter it entered into takeover negotiations with prospective buyers.

Ian Dixon
New Jersey —  March 22, 2018 5:46pm ET
Having collected a number of bottles of Châteauneuf-du-Pape, do we know what we should be looking out for to identify the frauds in our collections, and indeed when buying?
Mitch Frank
New Orleans, LA —  April 2, 2018 12:18pm ET
Hey Ian,

Thanks for reading. The French Fraud Agency reports that the questionable Châteauneuf-du-Pape was destined for the U.K. and France. Most has been recalled. When we know more, we will update you.

All best,
Mitch Frank
News Editor

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