Fake alcohol investigation

Just how widespread is Shanghai's counterfeit drink problem?

Everyone’s heard stories about fake alcohol in Shanghai, but how prevalent is the problem? Charlotte Middlehurst speaks with three drinks experts to separate the myth from the methanol


This time last year, Songjiang police arrested 25 people for orchestrating the city’s biggest ever fake wine scam. The gang members scoured chat rooms for wealthy businessmen, and lured them to the district’s Hanini bar with seductive promises of luxury wine, among other treats. The brands, however, were counterfeit and no less than 210,000RMB was extorted before the ringleaders were caught and sentenced to ten years in prison.


While headline booze busts are rare, the practice of selling fake bottles is all too common. Most drinkers in Shanghai have, at one stage (if not several), woken up with a sledgehammer of a hangover, seemingly disproportionate to the amount drunk the night before. But is fake liquor really to blame, or is it just a handy scapegoat for our excesses?


George Chen, owner of Roosevelt Prime Steakhouse with 35 years of experience buying wine, estimates that as much as 80 per cent of the alcohol in Shanghai is fake. The San Franciscan connoisseur, who owns an impressive personal collection of Lafitte wine, cites mark ups of up to 1,000 per cent, where wines made for 4RMB are sold for 400RMB.


Fake, here, implies two classes of fraud. The first and most common is counterfeit branding, where spoiled, low grade bottles of wine are sold as the real deal, yielding unreal margins. Common imposters belong to the expensive wine section: Chateau Lafitte (which can sell for over 65,000RMB), Penfolds, Chateau Margaux, La Torre and Petrus.


The second class is the more dangerous: Frankenstein mixtures made by illegal labs in Guangzhou, Fujian and Shanghai, where chemical dyes and tarnished wine are sold for cheap to ignorant secondary and tertiary markets.


'The trouble with a lot of the cheaper stuff is that it’s not wine per se,’ says Chen. ‘[Vineyards] overproduce and don’t do a great job harvesting – the light juices are not wine-ready so they have to add something to it to make it palatable. They get bulk wine in from the big wine producing countries and they mix and match. For example, they might put wood chips in to fake the taste of tannin.’


With fake liquor, the situation is more serious, on account of its higher proof and core ingredient: methanol, ie industrial alcohol. You recognise the name from the back of antifreeze, solvent and fuel canisters.


Dr Michael Sui is a specialist in internal medicine at the World Path Clinic focusing on liver, stomach and lung problems. He says that fake alcohol is a serious issue here.

'We see young, young students who’ve been binge drinking with gastritis, stomach irritations and even pancreatitis,’ he says. ‘In my practice, there are roughly five such cases per month, 60:40 male to female. A lot of patients don’t address it as a first complaint. They don’t say “I have a problem with alcohol.” Instead they complain of stomach pain.’


Some of these complaints can be attributed to excessive intake of genuine alcohol, but Sui says that some are due to fake alcohol’s dangerous additives, which can cause a range of health problems. ‘Methanol damages the nervous system, especially the optic nerve. It really depends on the amount you ingest but if you drink a lot, it can cause sudden blindness and death.’


So where is harmful booze being sold and how can we avoid it? Chen claims it permeates every level of the F&B industry. ‘I’ve personally had vendors coming to me to compete for my business and say, “How much do you want Johnnie Walker Black for? I’ll give it to you for 30RMB/bottle less than the competitor if I can get the bottle back.” ’ Vendors who operate like this, then take the genuine bottles and resell them with fake alcohol.


'Sometimes at clubs a bartender will bring his own fake bottles in – and why do you think waitresses are so quick to snatch empty Johnnie Walker and Dom Perignon bottles back?’ says Chen. ‘This happens at 75 per cent of clubs. I’ve seen it at both busy and slower places, everywhere from Xintiandi to The Bund.’


However, not everyone agrees with Chen’s alarming description of a fake alcohol epidemic. Stephen Notman is the organiser of Whisky Live China, one of the world’s biggest whisky festivals, which visits Shanghai every September. He downplays the prevalence of fake alcohol in the city. ‘The streets of Shanghai are not plagued with fakes. Loss of credibility and damage to reputation is imperative to the success of bars. For many, the risk is too high to even remotely think of purchasing alcohol from a non-official vendor.’


And what about Scotch, allegedly one of the most popular fakes? ‘Scotch is one of the most heavily legislated spirits in the world,’ Notman says. ‘It is also the most popular with bottles ranging from 150RMB-2,500,000RMB in price. With such variety in both price and taste, Scotch is constantly under attack from counterfeiters all over the world.


'It’s important to highlight that the Chinese Government invited the guardians of The Scotch Whisky Association (SWA) to apply for Geographic Indication,’ Notman continues. ‘This is one of the highest pieces of protection available to any foreign spirit entering China.’


This agreement was signed by the UK’s Secretary of State for Business Vince Cable on his visit to China in 2010 acknowledging that Scotch can only be produced in Scotland, making it illegal for Chinese producers, and counterfeiters, to use the word or reference Scotch with their products.


Paradoxically, the presence of the Scotch laws draws attention to the absence of wider regulation. It’s unlikely anyone who’d fake a trademarked brand like Johnnie Walker would think twice about using the word Scotch.


'I think the Chinese Government is trying to solve [the problem],’ says Chen. ‘But like anything else in China, it’s a pretty open market in terms of products coming in. The Government needs to do a better job regulating the wines particularly. In the US, if you got caught selling fake wine you’d get busted, sued and put out of business.’


How to spot a fake


Check unfamiliar brand names online If you’re unsure about a particular brand of alcohol, research it on the web, or stick to ones you know.

Check the serial number Bottles like Johnnie Walker Black come with serial numbers, often on the cap. If it’s not there when you know it should be, it’s a fake.

Check the bottle A number of quality alcohol brands have very particular specifications for their bottles, like special etching marks above the label. Details can be found online. You should also look for signs of tampering around the bung and, on vintage bottles, the importer’s name and mark.

Trust your taste buds Wine should taste round, if it doesn’t it’s probably been fabricated. Remember the old adage: if it’s too good to be true, then it probably isn’t.

See more bars and clubs