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Massive fraud' at Champagne Esterlin

Published:  23 July, 2008

On 5 July, Pascal Chaux, the state prosecutor at the Tribune de Grand Instance at Chlons-en-Champagne, announced that three of the leading officials of Mancy co-operative Champagne Esterlin were under investigation for massive fraud'.

Patrick Jean, the president, Lysiane Graudel, the administrative, financial and commercial director, and the chef de cave are accused of passing off over a number of years hundreds of thousands of bottles of non-vintage Champagne as vintage, so

gaining e1.50 per bottle. Many of these bottles were sold through Ed, the hard-discount arm of French retail giant Carrefour. The first Ed store opened in Paris in 1978. With 641 stores at the beginning of 2005, Ed is now France's number two hard-discount chain. Chaux also is investigating alleged social security fraud and the very large quantities of sugar purchased by the co-op.

The investigation began several months ago when three former staff, who had been made redundant, went to the French authorities. It is reported that the three were made redundant because they had discovered the irregularities. Graudel is under investigation for fraud,

misappropriation of the co-op's funds, destroying evidence and mental harassment of her staff. Jean is accused of fraud and misappropriation of funds, while the chef de cave is accused of fraud and harassment. All three accused have been released on bail of e20,000 each, and have been banned from both the co-op and contact with any of its staff. Although the co-op, whose offices are on the Avenue de Champagne in Epernay, was founded in 1948, it was not until 1985 that it started selling Champagne under its own name. It owns 120 hectares of vines and produces around 85,000 cases a year - 30% under the Esterlin brand.