Chinese billionaire indicted in US aluminum import scheme

LOS ANGELES — A Chinese billionaire has been charged in Los Angeles in a complex scheme to avoid $1.8 billion in aluminum tariffs, federal prosecutors announced Wednesday.

Zhongtian Liu, the founder of China Zhongwang Holdings Limited, and the aluminum company he previously headed, were charged with conspiracy, wire fraud and international money laundering.

The charges come as the U.S. and China try to reach a trade agreement aimed at ending a tariff war.

Liu, 55, schemed to import aluminum in the shape of pallets, which would avoid 2011 customs duties up to 400% that were not imposed on finished merchandise, prosecutors said.

The pallets, however, were three to four times heavier than typical aluminum pallets, and were sold to U.S.-based companies controlled by Liu and stockpiled at Southern California warehouses.

The scheme created the false impression that demand was high for the company's product and artificially inflated sales volume in annual reports, prosecutors said.

"This indictment outlines the unscrupulous and anti-competitive practices of a corrupt businessman who defrauded the United States out of $1.8 billion in tariffs due on Chinese imports," U.S. Attorney Nick Hanna said. "Moreover, the bogus sales of hundreds of millions of dollars of aluminum artificially inflated the value of a publicly traded company, putting at risk investors around the world."

The scheme largely took place from 2011 to 2014, though it is ongoing, prosecutors said.

Prosecutors have sought to seize the warehouses where the aluminum was stored and more than 275,000 aluminum objects in the shape of pallets.

Liu and two co-defendants charged in the scheme are not in custody and are believed to be out of the U.S., prosecutors said.

Neither Liu nor the company has an attorney that prosecutors are aware of, spokesman Thom Mrozek said.

Messages seeking comment from China Zhongwang, a publicly traded company based in Liaoyang, were not immediately returned.

You may also like these

France, Australia call on China to observe rules

May 2, 2018

French President Emmanuel Macron and Australian Prime Minister Malcolm Turnbull have issued a...

Usain Bolt to make run at pro soccer in Australia

Jul 17, 2018

Trading spikes for boots, Usain Bolt ready to make run at pro soccer in Australia

Australia bans Huawei from 5G network over...

Aug 23, 2018

Chinese-owned telecommunications giant Huawei has been blocked from rolling out Australia's 5G...

Prince Harry opens memorial as royal tour...

Oct 20, 2018

Prince Harry has paid tribute to Australian servicemen and women by opening a new wing of a war...

Australian gov't offers balanced budget just...

Apr 2, 2019

Australia's treasurer says he will unveil the government's first balanced annual budget plan in a...

Search
Financial Markets

About Us

Established in 2015, The Upstocker provides insights on financial reports, commentary, and investment data to traders so that you can make better investment decisions.

Contact us: sales[at]theupstocker.com

Subscribe Now!