Stephen Burton, along with accomplice James Wellesley, admitted to a $99 million Ponzi scheme involving bogus loans backed by nonexistent wine. They claimed to connect investors with wealthy wine owners needing cash, promising high returns on loans over 12 months. However, prosecutors revealed that the actual collateral was a mirage, with many promised wine bottles absent. Between 2017 and 2019, the pair used funds from new loans to pay earlier investors. Burton pleaded guilty to wire fraud conspiracy and money laundering, facing a lengthy prison sentence.
"There was no wine," he told Judge Pamela Chen. "For some of these loans, there was no wine."
Burton pitched his wine-as-collateral business in a 2013 interview with CNBC, saying he was catering to people with bad credit or other problems with banks who were wine rich and cash poor.
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