Caveat emptor

Caveat emptor

Mark Gillespie is a U.S. Contributing Editor for Whisky Magazine, as well as the host and producer of WhiskyCast, the world's longest-running Whisky podcast. He is a veteran broadcast journalist, photographer, and member of the Malt Maniacs group. Mark lives with his family in the charming, yet regrettably dry town of Haddonfield, New Jersey

Thoughts from... | 07 Dec 2012 | Issue 108 | By Mark Gillespie

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That’s Latin for “let the buyer beware”, and while Latin may be a dead language, the sentiment of this statement is very much alive; especially when it comes to whisky auctions and “investing” in “rare” whiskies.

Let me be clear up front: there are many honest people in the auction business. However, even the most honest people can be lead astray. Last June, Bonhams had to pull a “Circa 1900” bottle of Ardbeg from a New York whisky auction after Adam Herz of the Los Angeles Whisky Society correctly pointed out a key flaw in the description. The bottle carried language required by a United States law that didn’t exist until 1934 – making it impossible for the bottle to be “Circa 1900”.

The Society’s blog post cited a Bonhams whisky specialist as having “spoken to the owner of the bottle, and he is adamant the bottle is dated properly.”

Unfortunately, the lure of profiting from “investments” in whisky has caused many whisky lovers, as well as more than a few punters, to turn off their common sense.

I can understand the “Circa 1900” nonsense in an eBay auction, where nothing should be taken at face value. However, I expect more from professional auction houses employing whisky experts to assess the authenticity and provenance of so-called “rare” bottles that come to them for evaluation and sale. The web site for McTear’s states: “As agents for the Seller, McTear’s relies on information from the Seller concerning a Lot.”

I’m not against buying whiskies at auction. In fact, auctions provide many newcomers to whisky with the chance to acquire bottles that have long since disappeared from retail shelves. Despite the claims of some that there’s money to be made “investing” in whisky, a close look at the post-auction results will find many auction lots going for close to the original retail price, with only a few handful of lots selling for £1,000 or more.
On that note, could someone please tell us just how many bottles of the original Black Bowmore from 1993 still exist? Almost every major whisky auction I’ve looked at in the past five years has a Black Bowmore in the catalogue (along with late 1940s era Macallans), and they invariably sell for£,2000 to £2,500, give or take a few hundred quid, dollars, yen, euro, or whatever the local currency is. Since there’s usually no history given for a lot to determine how many times it’s been sold in the past, we have no way of knowing whether a bottle’s being “flipped” from auction to auction in hopes of making a quick profit. Given that the auction houses charge the seller a 15 per cent commission, there’s not much profit in flipping whiskies when the value consistently holds steady.

The profit, unfortunately, lies in, shall we say, relying on an old family history along the lines of “my great-grandfather drank nothing but Glen Googly, and he died in 1960…so this bottle has to be at least that old.” While auction houses do act as agents for the seller, it’s fair to expect them to be well aware of this when a seller can’t definitively prove the provenance of a bottle.

Sadly, whisky and outright fraud have often gone hand in hand. History buffs will remember the Pattison Brothers scandal of 1899-1900 that almost brought down the entire Scotch Whisky industry. My fear is that a similar scandal involving “rare whiskies” will help to burst the bubble in today’s whisky prices, along with the bank accounts of many honest whisky lovers and collectors.

To be honest, there’s really only one sure-fire way to make a small fortune investing in whisky.

Start with a large fortune.

Then again, one could open an online whisky auction site. Wonder if is available? Turns out it is, and in fact has been taken and is available for sale).
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