'Bernie Madoff of the wine world' busted; 75 victims in Michigan

- A federal judge sends a California wine seller to prison. His crime? Stealing money on a global scale with dozens of his unsuspecting customers here in Michigan.

But his Ponzi scheme reached around the world.

John Fox surrendered to federal agents after an executive for China's largest real estate company filed a criminal complaint claiming Fox ripped him off for $900,000 And he wasn't alone.

"It came as a surprise, not a horrible shock, but a surprise," said Jim Friedman, wine connoisseur.

"They stopped answering the phones," said Ken Johnson wine connoisseur. "And I am like, oh my goodness, come on."

Fox ran Premier Cru in Berkeley, California for nearly three decades until his business started dying on the vine.

"A $150 bottle of wine that's normally $350," Johnson said. "We're loving that. We'll wait six months for that type of price."

His bankruptcy records show he's $70 million in debt. Fox owes money to more than $9,000 to customers from London to Rome, Shanghai to Melbourne, from Honolulu to Hastings-on-Hudson.

And all 50 states in between.

That news made headlines around the wine world. About 75 victims are here in Michigan.

Here's how his Ponzi scheme worked. Fox took orders in advance, for wine from the world's most famous vineyards, most of them from France.

Sometimes the wine was still in the barrel. Guaranteeing a customer a bottle of the best vintage, at a good price. When it was ready all they had to do was wait and Fox made them wait.

"Everyone knew they were taking one or two or three years to deliver wine," Friedman said. "But they were still delivering it 90 percent of the time."

Fox told the court if an old customer complained,  he'd use money from a new customer to fill the order. And that worked, for years, Premier cru had a pretty good reputation.

"Most of the time they delivered," Friedman said. "And up until the last year if they couldn't deliver, they would give you something worth more than what you thought you were buying."

Fox was known as a hard working family man, although he had a penchant for fancy cars. Real fancy. Fox confessed he used his customer's money to buy a Ferrari, a Maserati, and a $90,000 Corvette, paid his mortgage, his kid's college tuition, dues for two private country clubs and shelled out nearly a million dollars to young women he met online.

His days of wine and roses are over.  A judge sentenced Fox to six and a half years in prison.

"At the end of the day everybody just wanted the wine but you're always going to have someone who comes in and messes it up," Johnson said.

Up Next:

  • Popular

  • Recent

Stories you may be interested in - includes Advertiser Stories