One of the most high-profile violin dealers in the world has been sentenced to six years in prison for conning creditors out of an estimated €100m (£80.3m).
Dietmar Machold, aged 63, was found guilty of large-scale fraud and embezzlement by a court in Austria. His ex-wife and her mother were accused of being accomplices and each sentenced to one year suspended sentences.
Machold had used real and fake Stradivarius violins as collateral for huge bank loans, rather than selling them, as he’d promised to do.
The prosecutors in the case said they also assumed he had underwritten documents assuring the authenticity of fake Stradivarius violins and sold those instruments at hugely over-inflated prices.
His scam was discovered in April last year when a forestry expert was called in to examine two instruments that Machold had passed off as Stradivarius violins. He had provided the instruments as collateral for a €5.9m (£4.7m) loan. On examination, the violins were found to have been made from trees felled years after Stradivari had died; the instruments were in fact worth just €2,000 (£1,600).
Machold ran offices in Chicago, New York, Tokyo, Seoul, Zurich and Vienna and lived in a 700-year-old castle outside Vienna. He was made an honorary professor by the Austrian ministry of culture.
In 2010, his international businesses declared themselves insolvent with debts totaling €80m (£64m).
Speaking to Der Speigel newspaper, the chief judicial administrator said: ‘He knew how to use an extremely flattering image of himself complete with cast, camera and clock collections, expensive cars and companies scattered across the globe, to pretend to be something he was not.’
The case is the biggest instance of fraud in the history of the violin trade.