Stradivarius dealer admits embezzlement as trial begins

Wed Sep 19, 2012 12:04pm EDT
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By Michael Shields

VIENNA (Reuters) - One of the world's top dealers in precious Stradivarius violins admitted he embezzled money made from the sale of instruments entrusted to him by his customers, but denied fraud charges as his trial got under way in Vienna on Wednesday.

Dietmar Machold, a 62-year-old German, was once the world's most influential dealer in instruments crafted by 18th century masters like Antonio Stradivari, whose workshop in Cremona, Italy produced some of the finest violins and cellos ever made.

A high-society fixture, Machold lived in an Austrian castle, had a fleet of expensive cars and collected watches and cameras. His global network of rare instrument dealerships let him move with ease in the highest circles of music, fame and money.

But his empire collapsed in 2010, triggering claims against him worth tens of millions of dollars from creditors and clients who say they were bilked.

The trial is scheduled to last three days. Machold faces up to 10 years in jail.

Prosecutor Herbert Harammer traced the career of the fifth-generation violin expert who built his Bremen-based family business into an empire with branches in Zurich, Vienna, New York and Chicago to serve elite musicians and collectors.

"This ascent was built on sand," Harammer told the court, accusing Machold of leading a lifestyle that was a facade for a business that had actually been insolvent since mid-2006.

Dressed in a dark suit and red print tie and led to the court in handcuffs from the detention center where he has been held for months, Machold was calm and composed as the charges were read out, variously looking at the floor or ceiling.   Continued...

Defendant German businessman Dietmar Machold, wearing handcuffs, awaits the start of his trial for fraud and embezzlement at a court in Vienna September 19, 2012. REUTERS/Heinz-Peter Bader