La gueulante du jour, ou la sournoise dérive d’un Parker…

Tout est bon pour faire du fric, y compris des points ! Et n’allez pas croire qu’il s’agit-là des précieux points de votre permis de conduire…

Une fois de plus, je vais jouer les naïfs, refaire mon numéro de « ronchon de service ».  Une fois n’est pas coutume, je vais me glisser dans les draps immaculés des vierges effarouchées. Je ne sais pas si c’est courant (ou plutôt si la pratique était en vogue au temps jadis où…), mais depuis que Bob a été racheté par les moneymakers de Singapour, on a déjà un premier signe de ce que peut donner l’idée qui consiste à «merchandiser» ses notes.

On va me dire que c’est normal, que grand bien lui fasse, que l’époque des bonnes mœurs est révolue. Et pourtant, pour ce qui me concerne, c’est bien la première fois que je commence à regretter le temps où le cher Robert Parker lui-même, puisqu’il s’agit de lui, simple «Bobby» du côté de Libourne ou d’Ampuis, était réellement indépendant, intègre, cohérent, véritable maître chez lui.

Bien noté, bon et pas cher… C’est du Parker. Photo©MichelSmith

Avant que Bob ne vende sa boîte pour assurer ses vieux jours (tout en se gardant le droit de noter ses favoris), au temps béni où l’on croyait encore à la morale, le vigneron dont le vin avait été bien noté par le maître de Monkton, dans le Maryland, comté de Baltimore, pouvait le faire savoir à son attachée de presse, le communiquer à tue-tête aux journalistes du monde entier, en faire part dans les magazines ou dans la presse locale. Disons que ça lui permettait de vendre un peu mieux que de faire mention d’une simple bonne note dans le B & D ou dans le RVF.

Surtout, dire que Parker avait bien noté son vin, ça ne mangeait pas de pain, ça flattait l’ego en même temps que ça ne coûtait rien de le dire. Bref, ça pouvait rapporter gros. Or, les temps changent vite puisque quelque soit le guide, Hachette ou Gault-Millau, il faut gagner plus que ce que ne rapportent de simples ventes en librairies. Et puisque les guides se vendent moins, essayons donc de commercialiser les commentaires à prix d’or avec, en prime, des salons, des annonces pub, des stickers, des organisations de master classes et, en bien plus classiques, des pseudo-médailles ou pseudo-diplômes.

En Côtes Catalanes, du côté de Tautavel… Photo©MichelSmith

Pendant que s’opèrent les transformations de nos sociétés, les irréductibles vieillissent et finissent par se mettre au goût du jour. Ayant résisté longtemps à ces travers commerciaux qui pouvaient dénaturer leur réputation comme leur crédibilité, les résistants critiques tels Robert Parker changent subitement leur fusil d’épaule. Et ils se rattrapent en saignant le brave vigneron qui, lui, de son côté, n’attend que ça pour vendre plus cher et en plus grosse quantité. Un peu comme s’il venait de recevoir une médaille d’or au Salon de l’Agriculture ou à Mâcon en s’empressant de l’afficher en bonne position sur l’étiquette de sa cuvée, le vigneron peut désormais – je suppose en payant ce qu’il faut – afficher son score Parker (et non son prix) sur la bouteille pour ensuite laisser tranquillement le buzz se faire.

Photo©MichelSmith

L’autre jour, dans mon troquet favori, au Bistrot des Crus à Perpignan, ayant vidé avec des potes un flacon d’excellent rapport qualité-prix (11 € la bouteille sur table !), je demande à voir l’objet du délit de plus près. Il s’agissait d’un Côtes Catalanes 2011, ex Vin de Pays devenu depuis IGP et baptisé «Le Cirque».

Belle étiquette, bouchon à vis, petit prix, du Carignan dans l’assemblage (et probablement pas mal…), du Grenache aussi; bref, en dehors d’une puissance et d’une maturité intenses (14°5 affichés !)  ce vin avait tout pour me plaire, y compris du minéral/rocailleux (clin d’œil…), et le fait est que la bouteille fut expressément asséchée était un bon signe.

Tout en le buvant, je songeais à une récente chronique de Matt Kramer relevée je crois la première fois, il faut le préciser, chez Bon Vivant. Membre éminent et «historique» du Wine Spectator, Matt évoquait cette fameuse barre des 90 sur 100 pour dire avec pas mal d’aplomb que les vins au dessus de 90 étaient devenus risqués et trop coûteux pour un simple honnête amateur et que c’était en dessous de cette barre qu’il fallait chercher ses trésors plutôt qu’au dessus. Bien sûr, j’interprète un peu à ma façon, mais vous n’aurez qu’à lire son billet vous même, si vous causez l’amerloque, pour vous faire une opinion.

Je me disais donc : «Un vin pareil goûté à l’aveugle, si j’étais Parker, je lui ferais franchir le seuil des 90 ! » Je ne croyais pas si bien dire car en tournant et retournant ma bouteille je remarquais une vignette ronde, toute dorée. «Encore une médaille d’or», pensais-je en mon for intérieur.

Où l’on voit par la trace laissée sur l’étiquette que c’était du bon… à 11 euros sur table ! Photo©MichelSmith

Eh bien non ! En ce cercle doré, un chiffre mystérieux ressortait : «91». Un chiffre rehaussé du nom du fondateur de The Wine Advocate. Mon exemple de ce vin inattendu provenant d’une grosse cave coopérative (celle de Tautavel) noté à 91, au demeurant excellent et pas ruineux, je le répète, prouve que même au-delà de 90 points, et quelque soit le score, d’ailleurs, on peut encore faire des découvertes et se faire plaisir.

Reste ce cercle d’or collé en coin supérieur de l’étiquette avec ce chiffre 91 en évidence. Il rappelle étrangement les médailles d’or en tous genres, et même les médailles de bronze ayant la couleur du vieil or. Elle n’a pas été apposée là gratuitement, cette pastille dorée. D’où cette simple question pour clore le sujet : sans chercher à jouer le moralisateur de service ou le vieux schnock donneur de leçon, on est en droit de se demander comment un type aussi intègre que Robert Parker a pu se laisser entraîner dans une telle embarcation?

Je sais, ce n’est probablement qu’une vulgaire histoire de pognon. Car comment peut-on se lever le matin et se regarder dans la glace en disant : «Ça y est, j’ai vécu ma période héroïque, j’ai prouvé au monde que l’on pouvait être intègre, même en matière de vins. Maintenant, la soixantaine passée, y’a que le fric qui compte. Youppie, la vie est belle ! » Oui, comment un homme sanctifié de par le monde a-il-pu tomber aussi bas ? Même en semi-retraite…

Michel Smith

PS – J’ai aussi trouvé un pur Grenache noir noté 91/100 par Parker sur le site espagnol Uvinum, à moins de 5 € le flacon. Les vins pas chers notés 91, ce doit être une nouvelle tendance chez Parker. Histoire de ratisser encore plus large…

The Wine Investment Association (WIA) – a sadly missed opportunity

 

After a two month consultation period, the WIA was officially launched on 14th February 2013. Certainly an association that attempts to offer guidance and confidence to investors, who are all too often misled, or at worst defrauded by unscrupulous ‘wine investment companies’, should be a very welcome development. Sadly this new initiative has to date been a missed opportunity.

The cold calling – an unsolicited phone call – of potential investors is one of the main curses of alternative investments such as wine, carbon credits and land banking. Having followed dubious drinks investments since 1996, cold calling is the principal way that investors have been persuaded to buy either inappropriate wine investments, which in some instances have never existed. Quite rightly there is a widespread distrust of companies that use cold calls. I certainly would not consider buying anything from a cold caller. I get rid of cold callers with various degrees of politeness or abuse depending upon my mood.

Details here of a BBC Panoramic programme showing how cold calling rules are flouted. (http://www.bbc.co.uk/news/uk-18600525)

It is, thus, very disappointing that the WIA’ code permits unsolicited cold calling. It has been suggested to me that permitting cold calls should not be ‘a deal-breaker’ with respect to cold calls. Rather that what really counts is important is having a code in place. This is not my view nor, much more importantly, the view of the UK’s Financial Services Authority (FSA), which bans unsolicited cold calls for investments purposes. Under FSA Guidelines only cold calls can only be made to customers who are anticipating a call. See the FSA’s one-minute guide to cold calling here: (http://www.fsa.gov.uk/smallfirms/resources/one_minute_guides/advice_sales/cold_calling.shtml)

‘How do we define cold calling?
Cold calling is where a financial promotion is made during any dealings with a customer which the customer did not begin.

However customers can be approached if they expressly request it. Failing to tick a box to say that they do not want to be contacted, or relying on standard terms that you may contact them again is not sufficient to allow you to cold call a customer.

What are the specific rules for investment business?
Investment rules allow for three scenarios where cold calls could be made:

the promotion is to an existing customer who anticipates receiving a cold call;

the promotion relates to packaged products that do not contain higher volatility funds, or to life policies not connected to higher volatility funds; or

the promotion only relates to readily realisable securities (but not warrants) or generally marketable non-geared packaged products.
(Les 5 comment: for investment purposes a cold call can only be made to someone who is expecting such a call.  Instances two and three are not relevant to wine investment)

Apart from the type of product being promoted, we also have rules about how the call must be conducted. Regardless of whether a call is a ‘cold call’ or expected by the customer, the caller must:

only make contact at an appropriate time of day;

identify themselves and the firm they represent at the start and make clear why they are calling;

ask whether the client would like to continue or terminate the call, ending the call if asked to do so; and

give a contact point to any client who they arrange an appointment with.

In contrast here is the WIA’s rather different definition of a permitted investment cold call (the bold is my addition):

The Association defines a cold-contact as a telephone call (or other communication) made to a private individual where there has been no previous communication with that individual, and where the individual has not provided his telephone number and/or given prior permission for the telephone call. Private individuals are able to opt out of receiving cold-calls by registering with the Telephone Preference Service (TPS). The Association will carry this advice on its own website, together with a link to the website of the TPS.

I am registered with the Telephone Preference Service (TPS). Being registered with TPS certainly does not prevent me from receiving numerous cold calls, although of course many of these calls may originate from outside the UK.

Had the WIA banned its members from making cold calls they would have made a very clear statement. A position that would have been clear and easy to promote – we don’t cold call. If you get a cold call from someone trying to sell you wine investments you will know that they are not a member of the WIA. As it now stands a cold caller may or may not be a member of the WIA. A confusing position for the old and vulnerable, who are especially at risk from cold calling.

Members of the WIA have told me that their strategy is to construct a big tent and that once they have a sizeable number of members ‘we can tighten up the rules once we get everyone in’. I am not convinced that this is a strategy that will work. Permitting cold calls is likely to put off companies who do not approve cold calls from joining the WIA, while encouraging those who do use cold calls to join. Much better to have been clear from the outset that the new Wine Investment Association would ensure that its code was in-line with that of the FSA.

Indeed Albany Portfolio Management Ltd, one of the WIA’s founders, does not use cold calls because they find them counterproductive and alienate potential customers. A pity they were unable to persuade the other three founding companies – Culver Street Trading, Provenance Fine Wines and Vin-ex – of the wisdom of their approach.

The WIA has also claimed that a ban on cold calling is unenforceable and that you ‘cannot stop cold calling’. It is obvious that the WIA has no regulatory powers and that given modern communications it is impossible to prevent all cold calling but that shouldn’t prevent an investment association taking a stand. After most of us disapprove of crimes like burglary and murder, even though we know there is no way we can stop them from continuing to happen.

The National Fraud Investigations Bureau has welcomed the creation of the WIA as reported in harpers here (http://www.harpers.co.uk/news/news-headlines/13486-wia-launches-wine-fraud-initiative):

Director of the NFIB, Det Supt Dave Clarke, said: "Fraudsters will always follow the money, with wine investment just the latest in a long line of investment opportunities that are being exploited and corrupted to the detriment of the industry.

"The NFIB sees an auditable framework of self regulation as a real and positive step towards maintaining and increasing consumer confidence, and assisting us to highlight those who do not operate to the necessary high standards."

Although I understand why the police welcome organisations that attempt to provide self-regulation in alternative investments not covered by the UK Financial Authorities, in this instance the WIA has set the bar too low and, in allowing cold calling’ they have not adopted ‘the necessary high standards’ cited by Det Supt Clarke.

The WIA code concludes thus: ‘in the course of its commercial activity no Member shall act permit any action to be carried out on its behalf, which, in any way:’ ‘brings, or may bring, the Association into disrepute’.

Permitting cold calling will bring the WIA into ‘disrepute’.

JIM

Wine investment in the spotlight

For several reasons, wine investment promises to be high up the agenda in the UK during this coming week. Continuing repercussions are likely over the collapse of Vinance plc, on Wednesday the Wine Investment Association will be launched, and I have no doubt that questions will continue to be raised about the valuation of the Nobles Crus wine fund.

Pichon-Longueville

Vinance plc 

The directors of Vinance plc placed the company in administration on Friday 16th November and Herron Fisher was appointed as administrators. They hope to be able to sell the company on as a going concern but I fancy this will be difficult. I can see the attraction for someone wanting to mount a white knight operation but otherwise I can’t see the attraction of a failed wine investment company.

This wine investment company started life in early 2002 as Morgan Aston Ford Ltd (MAF) with, amongst the directors, distinguished lawyer Timothy G. Ford as its chairman. In 2008 Vinance plc was set up with some of the directors from Morgan Aston Ford Ltd but not Timothy G. Ford. Vinance plc took over MAF’s business and this company was dissolved in 2010.

It will be a while before the number of creditors and the deficit are known. Most of the creditors are likely to be investors who have not been allocated their wine rather than from the wine trade. Although one might imagine that only recent purchasers of wine through Vinance plc will be affected, I have received a few messages from clients who have apparently been waiting for six years to be allocated wine they had bought. It may be that Herron Fisher will be able to find this wine, although they have already indicated that mismanagement was one of the factors in the company’s failure.

Vinance plc used to charge its clients a 25% upfront commission on the promise that when they came to sell there would be commission on the sale. Now, of course, investors are all too likely to have to fork out a commission when they come to sell in addition to the hefty 25% they have already played Vinance or to its earlier guise – Morgan Aston Ford Ltd.

Some investors have complained to me that they had difficulty to persuade Vinance plc to sell their wine for them. Not really that surprising as without a sales commission Vinance had no incentive to sell their clients’ wines.

Voilà! –two obvious disadvantages of the upfront commission for investors!

The Wine Investment Association (WIA)

This new initiative will be launched on Wednesday afternoon at the offices of Mazars, who specialise in audit, tax and advisory services.  It will be interesting to see not only the proposals from this new association but also to see how it will be run and to what level of independence the new body will have from its founders. Will the founder companies – Vin-X, Culver Street, Provenance Wines and Albany Portfolio Management – have to apply to an independent body for admission to the WIA or, as founders, is membership automatic?

Will cold calls be permitted by the WIA and what about upfront commissions? If investors and other fine wine companies are to have confidence in the initiative, which is potentially welcome and could be very useful for investors, then the WIA should set its face against both practices. There may be a place for a portfolio management fee providing investors are paying extra for something of value and the fee is properly explained and transparent but not if it is a disguised ‘up front commission’. This initiative moves wine investment towards regulation, albeit self-regulation. If all wine investment rather than just wine funds were to come under the remit of the FSA, then I am sure that cold-calling would be banned as it is for wine funds (classified as a collective investment) and for the selling of mortgages.

One of the most unpleasant aspects of the wine investment scams has been the hounding of elderly and vulnerable people by commission driven spivs only interested in maximising their wages to spend on flash cars, clothes etc.. Cold calling is part of that culture. I know that Albany Portfolio Management, for one, does not use cold calling as they believe that the practice is self-defeating. Surely all companies concerned about their reputations ought to come to the same conclusion?

The advice given or stance taken about storage, performance claims made, valuations, tax liabilities will also be crucial as will any proposals for policing the association.

The WIA proposals will be out for consultation until some time in January. Will they be joined by other companies? What is sure is that a group of recently formed companies have certainly thrown down the gauntlet to the rest of the UK’s fine wine brokers and companies. It would have been better if this could have come from more established fine wine companies but they have hitherto be reluctant to put something like this in place.

 A while to wait…

 Nobles Crus wine fund

The questions over this fund’s valuation raised by Le Vif L’Express and The Financial Times in early October persist. In part this is due to Elite Advisers, the founders and owners of the fund, being brave enough to think outside the customary box. Opting to feature a significant proportion of older vintages in the fund set them apart from other funds. It has, however, brought its own demands and potential problems, particularly as Nobles Crus is an open rather than a closed fund. This means that it is very difficult for the fund’s owners and managers to control the level of redemptions. Whatever Elite Advisers avowed strategy is, they are ultimately at the mercy of their investors who are free to pull out of the fund when they wish.

To still the doubts Ernst & Young has been called in provide a second opinion on the fund’s valuation following the customary audit by Deloittes (Luxembourg). Unless Ernst & Young inspect the stocks of older wines in Switzerland, assuming that they have the necessary expertise, then I cannot see how they can produce a credible and robust valuation on these wines. They need to see the state of the labels, fill levels as well as try to make a judgment on the provenance. If they do not, then they can only work on figures given to them by a third party.

‘The big question – the elephant in the room –  remains, if the demand for redemptions rose to around 15%-20%, how liquid would the older vintages prove to be? Also, would the valuations prove to be credible or would Elite Advisers find that they were getting offers to buy but at 25%-30% below their expectations?’

 Jim