A British man extradited to New York City to face charges in a $99 million fraud scheme involving expensive wine pleaded not guilty during his arraignment Friday in Brooklyn federal court.
James Wellesley and his business partner, Stephen Burton, are accused of running a Ponzi-like scheme by lying to unsuspecting international investors, including New Yorkers, that they were backed by a stockpile of valuable wine and clientele of high-net-worth collectors that didn’t actually exist.
According to prosecutors, the men secured nearly $100 million in sham loans and “used incoming loan proceeds to make fraudulent interest payments to investors and for their own personal expenses.” The alleged scam ran from at least June 2017 through February 2019.
Both men were charged in 2022 with wire fraud, conspiracy to commit wire fraud and conspiracy to commit money laundering in connection with the scheme perpetrated through Bordeaux Cellars, a company they allegedly operated.
Wellesley, 58, was arrested in the U.K. in February 2022. Earlier this year, he lost his fight against extradition to the U.S. after a judge at London’s High Court ruled that most of the losses caused by the alleged fraud “occurred or were intended to occur in the U.S.,” Reuters reported in May.
On Friday, Wellesley was arraigned before U.S. Magistrate Judge Robert M. Levy and pleaded not guilty to the charges. He was ordered to be detained pending trial.
Burton, a 60-year-old British national, pleaded guilty to the same charges in late 2023 after he was extradited from Morocco, where he had entered the country using a fake Zimbabwean passport.
With News Wire Services
