UK firm APW Asset Management Ltd (APW), which sold Australian wines for investment and capital growth using high-pressure sales tactics, was wound up by the High Court in Manchester on 25 March.
An investigation by the Insolvency Service found the company made ‘baseless claims that misled investors’. They made ‘a string of patently false claims as to the soundness both of the potential investment returns and of how wines sales would be handled’.
APW, which said on its website that it handled wine stocks worth £25m, claimed to offer ‘uncompromising and genuinely independent advice, free from conflicts of interest’. The company managing APW’s business on a day-to-day basis since last year, Quantuma, filed to put APW into voluntary liquidation in February.
APW’s main source of income since 2013 was from buying back wine from clients and reselling this wine to new clients, a process known as repack sales, according to the Insolvency Service. These sales accounted for 91.2% of APW’s income by March 2014.
The repack sales meant that clients selling their wine lost an average of 45% on the original price. New clients were hit with an average profit mark up of 81.3%.
APW estimated that there is a deficit of over 19,000 bottles that the company failed to buy.
The real ownership of APW remains a mystery. ‘The court heard that the company operated with a lack of transparency as to ownership and control. None of the company’s directors or personnel was able to provide information on the whereabouts or, indeed, existence of its 95% majority shareholder; and the control of the company does not appear to have rested with the appointed directors.’
Big Wine Company Ltd owned 95% of the £100 share capital. It is not known where the company is registered.
Written by Jim Budd