PROBLEMS MOUNT FOR PARADIGM GROUP

Published: 23 July, 2008

By Jim Budd

The long-term future of the Paradigm group of companies based in the Cayman Islands, Italy and the UK appears to be in question. The group is run by Bob Middlemiss, and includes Architects of Wine (AOW). On 13 August the American financial authorities issued an alert to all US banks warning them that Architects of Wines' method of selling multi-vintage wine contracts amounts to the sale of unregistered securities using unlicensed persons'. The alert goes on to warn: Be advised that banks may be approached to open a deposit account in which the sales proceeds of unregistered investments are deposited and then wired out of the country.' Middlemiss denies that he is selling securities and has told Harpers that he is trying to get the alert rescinded. In the UK, Paradigm Alliance Ltd, whose sole director and shareholder is Bob Middlemiss, was wound up in the High Court on 8 September as it had failed to pay 50,000 owed to Executives Online Limited. Middlemiss told Harpers that he disputed the debt. However, Executives Online Limited says it only received the complaint on the eve of the High Court hearing and dismissed it as nonsense'. Harpers understands that Northampton-based mail-order company Architects of Wine UK Ltd has substantial debts, including owing NYK Logistics Ltd around 130,000 and other known debts in excess of 100,000. One of the smaller debtors is Andrew Barrow of UKWinesOnline. Despite a small claims court ruling, a cheque for 116 has yet to arrive. Some AOW customers have complained that they have not received their wines. Middlemiss has told Harpers that there have been staff problems at AOW UK Ltd but that the company is committed to trying to resolve customer complaints and will respond to all customer queries. Customers should call 0870 213 610, where the two remaining staff will deal with their queries. The company's accounts are seven months overdue. Middlemiss has told Harpers that AOW UK Ltd may be disposable'. An earlier Middlemiss wine mail-order company called Cellar Select Ltd failed to fulfil some of its customer orders and went into liquidation in March 1998. Bob Middlemiss is a director of a number of other UK companies, including AVE United Kingdom Ltd (accounts overdue since June), Dazebao UK (accounts and return overdue and no company secretary), International Wine Customers Ltd and Les Garagistes. The Paradigm group also has an interest in One Stop Shop, run by AVE Italia, which sells wine direct from producers to restaurants in Italy, and is reported to be operating successfully. It is not clear whether the Paradigm group will now be able to supply its American clients with wines due to them under the multi-vintage wine contracts. These are worth millions of dollars.

Churchill Wines in provisional liquidation The DTI petitioned successfully in the High Court last week to have the Official Receiver appointed to wind up Churchill Wines Ltd, a Bordeaux wine investment company. The petition will be heard in November. Churchill Wines was set up in July 2001 but is not thought to have started trading fully until autumn 2002. The sole director was 36-year-old Malcolm Hills of Tunbridge Wells. Hills had previously been company secretary of wine investment company James Hewitt Associates Ltd, closed in the public interest by the DTI in 2002. Hills claimed to sell as an investment only those Bordeaux that had a minimum of 96 Parker points. The company's mark-up was generous. In 2003 it was attempting to sell Lafite 1996 for 2,990, when it could have been bought elsewhere for 1,870. It is believed that Churchill turned over in excess of 1 million. At the time of being closed down both the company's accounts and annual return were overdue.

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