ACROSS Scotland, and indeed most of the world, there will be many who find themselves daydreaming about the possibility of owning their own cask of whisky.

So often sold as a romantic idea, it’s easy to understand the appeal - but it is in fact an industry fraught with risk.

Throughout its history, the Scotch whisky industry has faced problems with malpractice as unsuspecting investors are often convinced of committing to something they know little about.

One company looking to combat this however is Whisky Partners, which has recently opened a new warehouse in Alloa.

READ MORE: Flamingo Land: Loch Lomond plans 'as bad as Trump's for Aberdeenshire'

In an exclusive interview with the Sunday National, the company’s co-founder Alistair Moncrieff discussed how the company operates, working to prevent fraud and how to keep an eye out for signs of scammers.

What does Whisky Partners do?

ORIGINALLY from Yorkshire, Moncrieff’s own background is in financial services although the chance to invest in the spirits sector came up shortly before Covid.

“I wanted to get involved in a new market and then the opportunity came at the perfect time,” he says.

“The business grew in such a quick way predominantly due to Covid because some people were sat at home wondering what to do with their money and the industry was getting a lot of attention from the media.”

Although Moncrieff says it’s an “evolving business”, effectively, Whisky Partners purchases casks of whisky - both Irish and Scottish - as well as other spirits such as rum from various distilleries and then either holds them for maturation purposes or sells them to independent clients.

Whisky Partners allows people to purchase their own caskWhisky Partners allows people to purchase their own cask (Image: Supplied)

As well as its base in Alloa, the business also has office spaces in both London and Brighton.

Giving clients access

WHISKY is a major factor in Scotland’s economy, with the Scotch whisky industry generating an estimated £7.1 billion in gross value added – a measure of economic productivity – in 2022.

Out of that overall total, £5.3bn was generated in Scotland while it also helped to support 41,000 jobs and 66,000 across the whole of the UK.

“Whisky has such a big impact and when you’re a new player in the space, you want to give clients as much access as possible,” Moncrieff explains.

The warehouse will be able to hold up to 7000 casks and was made fully operational this week.

READ MORE: 'Unique' Scottish distillery in appeal for investment in bid to help locals

The co-founder adds: “We want to let clients see, visit, manage and enjoy that maturation process.

“Over the next 18 months, we want to get all the casks in our maturation warehouse so all our clients have direct access to that stock.”

Dealing with cask fraud

EARLIER this year, a website called Protect Your Cask was launched to offer people guidance on what to look out for if they’re thinking about investing in the sector.

It’s an issue that’s been around for a long time and still exists today. Just last year, British fraudster Casey Alexander scammed more than £10 million from elderly and vulnerable victims by luring them in with promises of the “glamorous and lucrative” market of high-quality single malts and rare Scotch.

In terms of the key issues around malpractice, Moncrieff says there are four main ones.

He explains: “There’s blatant fraud, so that’s someone selling something that doesn’t exist. At the end of the day, you’re buying something in a warehouse. How do you know it’s there? So there’s a risk in that space.

“Secondly - and I think this is very big - there's people buying at the wrong price. It doesn’t matter what a return could be because if you’ve bought badly, you have to wait a long time to get the return you’re expecting.

“Thirdly, it’s people buying with the wrong knowledge. Whisky by its own nature is a long-term maturation process so someone thinking they’re going to make money immediately has the wrong attitude.

“A fourth area I would say is if you’re buying older casks - say it’s a 10 or 15-year-old - then what’s the history there? You wouldn’t buy a car without looking at mileage or how many owners there’s been, it could be bad wood or it might be leaking so there’s pitfalls there.”

Working to combat malpractice

GIVEN the potential for fraud then, Whisky Partners works to make any business as transparent as possible for any clients.

Moncrieff explains: “We have a number of processes. We only sell stock we own and we buy it from a reliable source.

“We’ll check that stock and make sure it’s got the right evaporation levels and do various checks on the pricing.

“Every cask is different. They might be filled with the same amount of litres of alcohol but as that grows, any cask will be dealt with differently.

“Clients purchase casks online and you can see the location at any time and the ownership process to see if someone had it before and how much they paid.”

As well as this, the co-founder adds that the business has invested “seven figures” into technology so people are aware of exactly what they’re investing in.

READ MORE: Argyll and Bute: Plans for new distillery in grounds of Scottish castle

“Just like if you bought any form of stocks and shares, you could see on your phone how it’s performing,” he says.

“So in a digital format, people can learn about the distillery, the cask, the wood and the price per unit.

“Clients can then visit those casks, we can draw samples, and over the next 24 months, we hope to get them all into one place.”

In spite of these risks though, Moncrieff is optimistic about the future, saying that any industry will ultimately always have to put up with malpractice.

“I don’t think these people will ever be here for long,” he says.

“Other companies have invested heavily and you would pick them over someone else that has better tech or because they have their own warehouse.

“There will always be an element of malpractice but that’s why you do your due diligence prior to practice.”