Update on Safe Harbor

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Tom Maskell
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Update on Safe Harbor

#1 Post by Tom Maskell » December 20th, 2018, 11:48 am

I was just sent this by someone who stored wine at Safe Harbor:

William "Billy" Holder was indicted yesterday in U.S. District Court, District of Maryland, on 5 counts of wire fraud and 5 counts of interstate transportation of stolen property. There is currently an warrant for his arrest. They expect to have him in custody shortly.

Tom

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Randy Bowman
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Re: Update on Safe Harbor

#2 Post by Randy Bowman » May 14th, 2019, 7:26 pm

A Maryland man who owned a storage and transportation business for upscale wines admitted Tuesday to stealing customers’ wines, and selling them to retailers and brokers in Napa and elsewhere, court documents show.

William Lamont Holder, 54, pleaded guilty to a federal wire fraud charge for stealing between $550,000 and $1.5 million of wine from customers of his Maryland-based business, Safe Harbour Wine Storage, the U.S. Department of Justice announced Tuesday in a press release. An indictment filed in December accused him of obtaining at least $2.3 million as a result of the scheme.

The indictment singles out four transactions between Holder and at least one unnamed wine broker in Napa, totaling nearly $90,000 for about 932 bottles of wine. It also mentions a fifth transaction for a Washington, D.C. wine broker who purchased about 92 bottles for $15,000.

All five transactions took place in 2016 and 2017.

Safe Harbour Wine Storage primarily dealt with private collectors and commercial establishments, according to the indictment. The company charged a monthly fee and pick-up charges to transport customers’ wines to a storage facility in Glen Burnie, Maryland. Customers could pay a delivery fee to have their wine sent to them, instead of picking it up at the facility, according to the indictment.

Holder’s customers did not know that he was offering their wine for sale to wine retailers and brokers nationwide, and sending potential buyers detailed lists of bottles of wines in his storage, including their vintages and asking prices via email and fax, according to the press release. Holder then boxed and shipped the wines, and buyers would wire the money into his account or send a check, prosecutors said.

Holder schemed to use his customers’ wines from January 2013 to December 2017, according to the press release.

Holder agreed to be sentenced to 18 months in prison, if the U.S. District Court of Maryland accepts his plea, according to the press release. U.S. District Judge Catherine C. Blake has slated his sentencing for July 31.
IN THE BUSINESS SHILL: An associate of a person selling goods, who pretends no association to the seller and assumes the air of an enthusiastic customer.

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Arv R
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Re: Update on Safe Harbor

#3 Post by Arv R » May 14th, 2019, 10:31 pm

That seems like a low amount of time to serve given the reported dollar value of theft.
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David Glasser
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Re: Update on Safe Harbor

#4 Post by David Glasser » May 15th, 2019, 4:25 am

This made the evening news in Baltimore last night.

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CJ Beazley
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Re: Update on Safe Harbor

#5 Post by CJ Beazley » May 15th, 2019, 4:29 am

Arv R wrote:
May 14th, 2019, 10:31 pm
That seems like a low amount of time to serve given the reported dollar value of theft.
Very low, did he roll over on someone to get this deal?
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Victor Hong
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Re: Update on Safe Harbor

#6 Post by Victor Hong » May 15th, 2019, 5:08 am

The biggest fencing agents may still be under investigation.
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J a y H a c k
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Re: Update on Safe Harbor

#7 Post by J a y H a c k » May 15th, 2019, 11:57 am

I think the federal sentencing guidelines on this has a sentence of 41-51 months. 6 points starting level for a theft offense and 16 points enhancement because of dollar amount, and assuming no enhancement for prior convictions.
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Re: Update on Safe Harbor

#8 Post by Russell A » May 16th, 2019, 4:34 am

CJ Beazley wrote:
May 15th, 2019, 4:29 am
Arv R wrote:
May 14th, 2019, 10:31 pm
That seems like a low amount of time to serve given the reported dollar value of theft.
Very low, did he roll over on someone to get this deal?
The true dollar amount is much, much higher. Bill was smart with leaving no paper trail other then the wired money from California. The problem lies in there is no way of proving who's bottle of wine is who's when it comes down to it. Like if I had 6 bottles of 75 Petrus and you had 4 of the same, Bill sold them to 2 or 3 different people. There is no way to tell your bottle from mine, so basically they have no true evidence when it comes down to it. He was breaking everyone's pallets up and selling them in different batches. Now I still don't understand how he could not be charged with theft in the case of every client though, but this all comes back to proving your bottle to my bottle. It definitely makes me madder then hell that he is only going to spend 18 months in a cushy prison that I still have to help pay for.
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Re: Update on Safe Harbor

#9 Post by Curt Wood » May 16th, 2019, 9:44 am

This was the lead story on the local news last night. For some reason, when signing his confession he crossed out "William" and signed it using "Billy" for his first name. The judge released him until he is sentenced and gave him permission to leave the state of MD. He requested this, claiming that he now worked as a "Lyft" driver. The TV people checked with Lyft and they had no knowledge of him working for them.

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Victor Hong
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Re: Update on Safe Harbor

#10 Post by Victor Hong » May 16th, 2019, 10:10 am

Lyft, in some foreign country without an extradition treaty. I suspect that Holder will Lyft himself there soon.
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Re: Update on Safe Harbor

#11 Post by Todd Laubach » May 16th, 2019, 12:07 pm

Russell A wrote:
May 16th, 2019, 4:34 am
CJ Beazley wrote:
May 15th, 2019, 4:29 am
Arv R wrote:
May 14th, 2019, 10:31 pm
That seems like a low amount of time to serve given the reported dollar value of theft.
Very low, did he roll over on someone to get this deal?
The true dollar amount is much, much higher. Bill was smart with leaving no paper trail other then the wired money from California. The problem lies in there is no way of proving who's bottle of wine is who's when it comes down to it. Like if I had 6 bottles of 75 Petrus and you had 4 of the same, Bill sold them to 2 or 3 different people. There is no way to tell your bottle from mine, so basically they have no true evidence when it comes down to it. He was breaking everyone's pallets up and selling them in different batches. Now I still don't understand how he could not be charged with theft in the case of every client though, but this all comes back to proving your bottle to my bottle. It definitely makes me madder then hell that he is only going to spend 18 months in a cushy prison that I still have to help pay for.
As I told my brother - Bill was so "f*cking dumb when it came to technology that he was smart". I agree that 18 months is too light but given the circumstances, at least he has to "pay" for his crime.

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Re: Update on Safe Harbor

#12 Post by Victor Hong » May 16th, 2019, 12:26 pm

Can I get a job that pays so well?
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Re: Update on Safe Harbor

#13 Post by Russell A » May 17th, 2019, 4:50 am

Victor Hong wrote:
May 16th, 2019, 12:26 pm
Can I get a job that pays so well?
I know right.. Apparently it pays to be a criminal
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Re: Update on Safe Harbor

#14 Post by cjsavino » May 17th, 2019, 6:51 pm

Chris
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Arv R
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Re: Update on Safe Harbor

#15 Post by Arv R » May 18th, 2019, 8:57 am

The other element of this that is disturbing - I don't think he should have been released pre trial/sentencing. There's plenty to suggest that he kept on stealing even while being investigated/sued etc.

Part of locking predators up is not just for punishment/rehabilitative reasons, but simply to stop the ongoing mayhem they cause. This seemed like a case where that was needed.

Pretty disappointing all around and I'm sorry for fellow enthusiasts losses.
R_@_0

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Re: Update on Safe Harbor

#16 Post by Brian Tuite » May 18th, 2019, 10:12 am

Russell A wrote:
May 17th, 2019, 4:50 am
Victor Hong wrote:
May 16th, 2019, 12:26 pm
Can I get a job that pays so well?
I know right.. Apparently it pays to be a criminal
Maryland... Mark Anderson got 27 years for his shenanigans in Mare Island although it was considerably more wine.
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Re: Update on Safe Harbor

#17 Post by Don Cornwell » May 19th, 2019, 5:05 am

The monetary loss caused by Mr. Holder was $2.33 million according to the indictment.

The DOJ press release says Holder is getting an 18 month sentence but that doesn't make a lot of sense given the sentencing guidelines (referenced in Jay Hack's post above), or after looking at the records for other similar cases (see below). It does in fact make me wonder whether there is some other plea deal between Holder and the DOJ that hasn't been announced. I had reported to the FBI back in 2016 that a person well known to the FBI as a fence for stolen wines was allegedly buying stolen wines from a wine storage facility in Maryland.

Unfortunately, alleged theft by wine storage operations has happened a lot more often than most wine collectors might think.

In February of 2012 Mark Anderson of Sausalito Cellars in Vallejo, CA pled guilty in Federal District Court in Sacramento to 19 felony counts, including embezzlement, mail fraud, tax evasion and arson. He sold several million dollars’ worth of customer wines that were in his storage facility and then burned the storage facility containing 4.5 million bottles of wine in order to cover his embezzlement. He was ordered to pay $70.3 million in criminal restitution and was sentenced to 27 years imprisonment.

In August of 2013, George Osumi of Legend Cellars in Newport Beach California pled guilty in Federal District Court in Orange County to 71 counts including grand theft, insurance fraud, identity theft and perjury. He stole $2.7 million worth of customer wines in his wine storage facility, and in many cases substituted inexpensive bottles for the bottle taken. He was sentenced to six years in prison plus ordered to make criminal restitution of the $2.7 million.

In August of 2016, Marc Lazar of Domaine Wine Storage (St. Louis, Washington DC, New York, Napa, Chicago) was sued in Montgomery County Pennsylvania by Great Northern Insurance Company who had paid out $1.97 million to a client of Lazar’s named Reid Buerger. Buerger claimed that Lazar had either converted or failed to account for more than 1,300 bottles of wine that Lazar had purchased for Buerger and his wife (through Lazar's company Cellar Advisors) which was then stored at the Domaine St. Louis and Domaine New York storage facilities. In 2014 Buerger terminated the relationships with Lazar and his entities and after receiving the wines discovered that he was allegedly missing 1,300 bottles. After Buerger's insurance company paid out $1.97 million on the loss, they sued Marc Lazar, Cellar Advisors, Domaine St. Louis and Domaine New York in state court in Montgomery County Pennsylvania (where Buerger lives.) Meanwhile, Lazar tendered that lawsuit to his insurance carriers and his insurers all denied coverage and filed lawsuits in Federal Court in St. Louis seeking a declaratory relief that there was no coverage under the insurance policies. The lawsuit in Pennsylvania was stayed (Lazar and his entities claimed the Pennsylvania forum was not convenient or appropriate). All of the litigation was thereafter conducted in the Federal Court for the Eastern District of Missouri in St. Louis.

Lazar and his companies eventually moved to dismiss all of the claims brought by Great Northern Insurance. On January 23, 2019 the Federal Court issued an order, which, with the exception of one claim for gross negligence (which Missouri law does not recognize) denied Lazar's motion to dismiss the claims by Great Northern Insurance. The case was sent to mediation and the case settled in April 2019. I do not know any of the details at this point, but it seems likely that Mr. Lazar and his companies paid off the alleged $2 million loss -- either directly or with the benefit of some insurance proceeds.

There is yet another bizarre case involving alleged theft by a wine storage company. A New York wine collector named Michael Moriarty filed suit against Chelsea Wine & Storage, Inc. in New York in December 2018. Moriarty stored wines with Chelsea since 2006 and for many years Chelsea apparently automatically charged Moriarty's credit card on a monthly basis for his storage charges. Chelsea stopped charging the credit card in September 2017, apparently because the credit card number on file had expired. In June of 2018 Chelsea sent a notice to Moriarty by mail and email telling him that if he didn't pay $6,300 worth of accrued storage charges within 10 days his wines would be disposed of by Chelsea. On July 30, 2018 they sent another letter telling Moriarty the contents of his wine locker were being destroyed allegedly pursuant to the terms of his contract. Moriarity alleges that he had 1200 bottles in storage with Chelsea which had a market value of between $100,000 and $200,000.

In late October of 2018 Moriarty attempted to obtain the delivery of all of his wine which Chelsea refused. Moriarty then discovered that many of his bottles that had been in storage were for sale in the Chelsea wine store. Moriarty demanded that Chelsea cease and desist and return the remaining wines and when Chelsea refused, he filed a lawsuit in New York State Court. On May 1, 2019 the Court issued a written decision granting a preliminary injunction against Chelsea. As the Court stated: "neither agreement allows Defendant to 'dispose' of Plaintiffs Wine to itself and then sell the Wine at Defendant's second location without accounting to Plaintiff and remitting to Plaintiff any amounts obtained by such sale in excess of the amounts owed by Plaintiff to Defendant for unpaid fees. Accordingly, the court finds that, upon a review of the proofs before it, Plaintiff is likely to succeed on the merits of the Complaint." You can find a complete copy of the Court's decision here: https://law.justia.com/cases/new-york/o ... 215-u.html
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Re: Update on Safe Harbor

#18 Post by Gary York » May 19th, 2019, 5:51 am

Sentence seems light. I guess those involved in it are not into wine.
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Re: Update on Safe Harbor

#19 Post by Victor Hong » May 19th, 2019, 6:23 am

Mike Moriarty is a very nice guy and did not deserve such treatment.
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Re: Update on Safe Harbor

#20 Post by Jim Brennan » May 19th, 2019, 6:24 am

As threads on this forum attest, plenty of people think crimes against people of means are a lesser offense.

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Re: Update on Safe Harbor

#21 Post by Gary York » May 19th, 2019, 6:30 am

Yes, and kind of sad. I guess it comes with the territory.
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Re: Update on Safe Harbor

#22 Post by John S » May 19th, 2019, 7:33 am

Sad to hear about the Mike Moriarty story at Chelsea. Met him a few times and a nice guy. Seems like no possible good ending here.

I met George Osumi 25 years ago when far as I knew he was just a wine collector like me. What a scum bag he ended up really being.
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Re: Update on Safe Harbor

#23 Post by Victor Hong » May 19th, 2019, 6:23 pm

If the wine at Chelsea Wine were covered with third-party insurance, a theft claim seems appropriate.
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