Anatomy of a wine scandal

What is known so far

It is perhaps too soon to write the full anatomy of this wine scandal. For now, it is more appropriate to stick to the facts, the skeleton of what is publicly known.

yahoo finance

As recently as six months ago, Yahoo! Finance marked the 10-year anniversary of a company called Oeno Group, describing it as “the London-based fine wine and whisky investment firm [which] specialises in sourcing, managing, and curating exceptional bottles for private and institutional clients.” The article (which seem to be a PR piece? A paid article?) highlighted Oeno’s services including acquisition, valuation, portfolio management, and secure storage, delivered by a team of seasoned experts.

Around the same time, Globe Newswire reported Oeno’s intention to launch a €20m fund in Portugal.

Globenewswire

These announcements coincided with a period of corporate change. According to public records, ownership of the group transitioned from Doerr Group Limited (owned by Michael Doerr) to American investor Marshall Willis Deutsch. No conclusions can be drawn from timing alone, but it is notable that public expansion plans and a change in ownership were unfolding in parallel.

Meanwhile, on Reddit, a thread that began two years ago — and has remained active — documents repeated attempts by customers to withdraw funds, and the difficulties encountered in doing so. (Note that there are many other threads, like this one, …)

Today, what we know is this:

Oeno Group — operating through entities including Oenofuture Ltd, Oeno House Ltd, and Oeno Trade Ltd — has published a notice, at the request of the City of London Corporation Trading Standards Service, warning that:

“Oeno consumers who have invested funds through the purchase of wine from Oeno over the past decade are advised that there is a risk that some or all of their investment may be lost.”

According to the notice, Trading Standards believes that only around 20% of the wine is held in individual customer accounts. The remaining wine is understood to be held in an account controlled by Oeno Future Limited.

What does this mean?

It means that only a minority of assets appear to be held in customers’ own names. The majority are held in company-controlled accounts. In practical terms, this suggests that assets were not fully segregated from the company.

This matters because Trading Standards state that the “most important next step” is administration. Once a company enters administration, control passes to an independent insolvency practitioner. At that point, outcomes are determined by legal ownership.

Where assets are not clearly held on trust for clients, and where ownership cannot be readily traced, investors risk being treated as unsecured creditors. In such cases, recovery is often partial, delayed, or — likely — nil.

This issue is not unique to wine. If client assets are not segregated from a firm’s own accounts, it makes little difference whether client funds were used appropriately or to support business operations. In an insolvency, the lack of segregation is what matters.

There are also indications that employees may have been affected. Reviews on Glassdoor suggest that some staff may have lost out, though details remain limited at this stage.

(Note that all the reviews are prior to the company’s change of ownership.)

This Oeno scandal underlines a practical point for anyone investing in wine—you should ask the firm to provide clear assurance that the wine is held in your name (or on trust for you), and that it is properly segregated. Segregation and traceable ownership records are what determine whether assets are likely to be directly accessible to you if a firm fails.

This story is ongoing. As more verified details emerge, I will update this piece.

If you would like to share your experience with Oeno, please hit reply if you received this email, or write to me at sara@inthemoodforwine.com

Support ITMFW

Love In the Mood for Wine? A paid subscription helps keep the free edition accessible to everyone — and unlocks exclusive perks for you.

Or simply share it to help grow the community!