Fighting Crime in the Wine Business

Sep 2, 2015

(Wines&Vines) - For years the owners of Whitehall Lane Winery in Napa Valley trusted a local woman to handle their books.

On the surface, their trust in Gerilee “Geri” Densberger would seem to have been well placed. Densberger was in her late 40s, had a family and volunteered for a Napa County nonprofit group that paid rewards for information about area fugitives and local crimes.

But the bookkeeper became a fugitive herself for a short time in 2014, when Whitehall Lane’s owners discovered Densberger had been siphoning cash from the winery as well as using company credit cards to buy expensive items for herself and her family. “Ms. Densberger was a trusted employee and was treated like a member of our family. Sadly, her actions have and will continue to hurt her own family and have a lasting effect on them,” the owner, Thomas Leonardini Sr., told the Napa Valley Register.

On Aug. 21, following her arrest and conviction, Densberger was sentenced to eight years in state prison. She had been found guilty of embezzling $600,000 from the winery and stealing $37,000 from Leonardini Sr.

The news of Densberger’s arrest came after Martin Chris Edwards was caught in Mexico, where he had fled after stealing nearly $900,000 from fulfillment firm The Wine Tasting Network. Edwards was sentenced to 33 months in federal prison in September 2014.

‘Trust but verify’

If it sometimes seems as if the wine industry has a higher rate of financial fraud and embezzlement cases, that may be because it does, at least according to Rob McMillan, who oversees the wine division of Silicon Valley Bank. In a post on his blog, McMillan details six other recent fraud cases in which a winery employee stole more than $100,000.

Based on his experience, McMillan said the trusting, hospitable nature of the industry and the “low value placed on accounting and proper management” are why wineries are more vulnerable to these types of crimes. He recommends winery owners adhere to a policy of “trust but verify” and also conduct audits with an outside accounting firm.


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