Would you invest with Twelve-by-Seventy-Five?

I’ll have to crave your patience as once again this week I am returning to the British disease – wine investment. Whether this British disease includes the Scots we will know more clearly after 18th September and the vote for Scottish independence or not as the case may be. But I digress …

Today I was contacted by a putative investor asking me my opinion of Twelve-by-Seventy-Five Ltd. I had never heard of this company – hardly surprising as it was only formed in January 2014 and the two current directors were not appointed until early April 2014.

Company founded on 24th January 2014.

However, a quick look at their website (http://www.twelve-by-seventy-five.com) raised considerable doubts and questions:

‘Fine wine is booming’ – actually prices have been falling since 2011 – a long bear market. ‘As expert wine traders’ – rapidly gained expertise!

‘We are experienced wine merchants & brokers’. ‘We have firmly established contacts with French négociants over the years’. Again impressively, rapidly gained experience for a company founded in 2014!

‘Free of capitals gains’ – partially correct as wines that are not expected to be drinkable after 50 years are exempt as ‘wasting assets’ but many investment grade fine wines are certainly drinkable after 50 years or more. 1961s, for example, are still being drunk with pleasure. Amusingly capital gains tax is currently less of a problem because of the long bear market so ‘profits’ on wine investment don’t really apply.

For all the nascent company’s expertise they have confused ‘appellation contrôlée’, that began in 1936 with the 1855 Classification.

‘Vinothéque in Barking’. Although Vinothéque is part of London City Bond, this storage facility for private clients is in Burton-on-Trent nearly 150 miles north west of Barking.   

Twelve-by-Seventy-Five Ltd is clearly a company to avoid at all costs – hopefully no-one will fall for this nonsense. Sadly I wouldn’t bet on it!

Jim Budd