The head of a wine investment company has admitted going on a cocaine-fuelled spending spree with investors' money but denies fraudulent trading.
Paul Craven, managing director of the Bordeaux Wine Trading Company in company based in Potters Bar in north London), took £1.2m from investors who thought they were buying 2005 First Growth Bordeaux en primeur.
No wine was bought from Bordeaux by BWTC, and only £12,000 of the £1.2m has been recovered, St Albans Crown Court heard at Craven’s trial for fraudulent trading which opened on 16 June.
Craven denies the charge, insisting the responsibility for buying the wine was that of Oseghale Hayble, also a director of the company.
Hayble faced the same charge but became ill during the trial, so proceedings against him have been postponed.
Giving evidence last week, Craven claimed Hayble would say how much money was needed and Craven would hand over cash. On one occasion it was £85,000.
‘Hayble told me that if he paid for the wine in cash he would get a 50-60% discount,’ Craven said.
Craven said that after Hayble left BWTC, in July 2007, to set up International Wine Commodities Ltd, ‘It was agreed that he would continue to purchase the wine’.
‘We met several times at the Maze Inn public house – sometimes in the car park and sometimes inside. I would hand over the cash for Hayble to buy wine.’
There were no receipts for the cash handed over to Hayble or for wine purchased.
Craven, who was receiving state benefits a month before setting up BWTC, admits going on a spending spree from the startup of company.
The court heard that £66,000 was spent on holidays, in New York, Las Vegas, Barbados, Sicily and Cyprus.
Craven also bought a series of cars including a £55,000 Range Rover, a £32,000 BMW for his girlfriend, a Porsche, and two £9000 motorbikes.
In July 2007 Craven spent £13,000 on a Cartier watch for his girlfriend and £10,000 on one for himself.
Craven also admitted that he spent around £100 a week on cocaine.
‘The company was taking in a lot of money – it was doing well,’ said Craven. ‘After the all the bills were paid, the money was ours to spend.’
The jury is expected to retire at the end of this week to consider its verdict.
The investigation was carried out by Hertfordshire Police.
Craven worked briefly for another investment company, the Bordeaux Wine Company, before setting up BWTC in July 2006. He was the sole signatory on the bank account until September 2007. The police raided and closed the company in June 2008.
Written by Jim Budd