BORDEAUX: What's Behind the 'Winegate' Trial

International Herald Tribune

Thursday, October 24, 1974

The French used to laugh about the frequent wine frauds in Italy. Now the sore is on them – they have a juicy scandal of their own and in their most prestigious wine region, Bordeaux.

On Monday, the so-called "Winegate" trial opens here. The indictment lists various forms of fraud involving the upgrading of vin ordinaire into appellation contrôlée Bordeaux, the destruction and altering of records, the transformation of white wine into red and the illegal use of chemicals. Eighteen persons have been indicted, including three members of the Cruse family, directors of the wine firm of the same name, one of the oldest and formerly most respected in Bordeaux.

The scandal gets its name from Lionel Cruse's self-comparison with Richard Nixon when the affair was first reported in August of last year by the satirical weekly, Canard Enchaîné (IHT, Aug. 31, 1973). Like Nixon, Mr. Cruse also thought the accusations would blow over, pooh-poohing their importance and getting himself caught in a clumsy and ineffectual cover-up. And while Mr. Cruse has yet to resign, the family firm is widely reported to be up for sale to a large British distillery.

If it has taken more than a year to bring the affair to trial (the first inspections by the Service des Fraudes at Cruse date back to June, 1973), the French minister of agriculture has just acted with unwonted speed in signing strict new decrees to control the quality of wine production. The timing can hardly be coincidental.

Last July, the Institut National des Appellations d'Origine, an advisory organization with the mission of preparing legislation and decrees concerning wine production and their control after enactment, issued a broad range of proposals to remove gaping loopholes in existing regulations (IHT, July 4).

In essence, the new rules forbid the "declassification" of production in excess of legal limits. To take a Burgundian example, a grower with a grand cru vineyard is supposed to produce no more than 30 hectoliters to the hectare.

In the past, if he produced 70 hectoliters, only the first 30 could be sold as grand cru, but another five could go under the communal appellation (whose limit is 35 hectoliters), 10 more as simple Burgundy (limited to 45 hectoliters) and the remaining 25 as vin ordinaire.

But this so-called vin ordinaire was the same wine as that sold as grand cru and the grower could get nearly as much for it from an exporter who would then rebaptize it with its grand cru name once out of the country. Nobody would mind this sort of thing were it not for the fact that only a low yield will insure that the wine has enough natural alcohol, mineral content, and everything else that goes to make a truly fine wine.

Henceforth, our sample grower can choose to make grand cru wine, or communal wine, or Burgundy, or vin ordinaire, but only one of these. Anything in excess of the category he chooses will have to be sold for distillation at one franc the liter.

He can also apply to have his entire crop accepted as grand cru. It then undergoes a tasting, but if it is not up to standard the entire crop loses the appellation and goes to the distillery. It's all or nothing. Furthermore, tasting controls will become obligatory for all appellation contrôlée wines before they reach the market. These new regulations go into force with the 1975 vintage.

There is no doubt that these severe restrictions on production will improve quality and, in the long run, gain back for France its reputation for fine wines. But in the short run, the excesses of the recent past brought on by a boom in wine prices – a boom which has now burst – together with the scandal, are going to mean a few lean years, especially in Bordeaux, which produces about 500 million bottles a year.

A few days ago, the union of Bordeaux wine shippers held a press conference to try to explain their role in the trade and to insist that the scandal is limited in scope. That may be. But Cruse is not the only member of the trade under indictment.

Some 2 million bottles of wine are involved at Cruse. The indictment states that this quantity would seem to indicate not a minor or temporary lapse but that such fraud was deliberate company practice. If so, it must have been going on for some time before it was discovered.

When asked what they intended to do to restore confidence in their reputation, the shippers' representatives were vague at first. They announced that their 250-member organization would be represented legally at he trial. Pressed further, they admitted that they had been petitioning the government since 1970 for the right to create stocks of wine with which they could regulate market fluctuations to avoid just the sort of excesses that developed during the price boom.

Asked if the extension of château-bottling would not have avoided the scandal in the first place, the shippers pointed out that there are more than 100,000 hectares of vines in the Bordeaux area, divided up among 30,000 growers. The average holding is thus only three or four hectares, which is not enough to pay for bottling costs.

Most of the wine from such small vineyards is sold in bulk to the shippers, who age, bottle and distribute it. These shippers handle 80 per cent of Bordeaux wine production and 95 per cent of the exports from the area. Nevertheless, many feel that the shipping trade may never be quite the same and that further measures will be necessary to restore customer confidence.