#7290535 at 2019-08-01 11:11:37 (UTC+1) Q Research General #9328 Ani - E Bake
Chinese billionaire indicted in U.S. for alleged $1.8 billion aluminum tariff evasion
WASHINGTON/NEW YORK (Reuters) - A Chinese billionaire has been indicted by a grand jury on charges he schemed with the aluminum company he founded to evade $1.8 billion of tariffs by smuggling huge amounts of the metal into the United States, federal prosecutors said on Wednesday.
Liu Zhongtian, 55, and China Zhongwang Holdings Ltd (1333.HK), where he served as chairman and president, were among several defendants charged in a 24-count indictment by a Los Angeles grand jury.
The May 7 indictment had been kept under seal until late Tuesday. It came as U.S. and Chinese negotiators resumed talks to end trade tensions between the world's two largest economies.
Neither Zhongwang or Liu, who is still the company's controlling shareholder, have received any notice of the proceedings, the company said in a statement to the Hong Kong stock exchange on Thursday.
Zhongwang has previously described smuggling allegations as "misleading" and "without any factual basis."
"The company would like to clarify that the group has always strictly abided by in its business operation the laws and regulations of the People's Republic of China and destination countries of its exported products, and has developed overseas markets under the principle of fair and orderly competition," it said in the statement to the exchange.
Zhongwang's shares fell as much as 20.9% on Thursday to HK$3.17 ($0.41), the lowest since January 2016.
Liu is believed to be in China, which does not have an extradition treaty with the United States, and an arrest warrant has been drawn up, according to The Wall Street Journal. It was unclear whether Liu has a U.S.-based lawyer. Liu and his family are worth $3.2 billion, Forbes magazine said.
Prosecutors said the alleged scheme began as early as 2008, and eventually involved efforts to escape duties imposed by the U.S. Department of Commerce in 2011 on various types of extruded aluminum imported from China.
The indictment said companies affiliated with Liu went through ports in the Los Angeles area to import aluminum extrusions that were "tack-welded" together, to appear as finished "pallets" that were not subject to duties.
Prosecutors said Liu would then stockpile the aluminum at four southern California warehouses, and with his associates orchestrate bogus sales to companies he controlled to inflate Zhongwang's financials and make it appear more valuable.
Liu, also known as "Big Boss" and "Uncle Liu" according to the indictment, was also accused by prosecutors of running a "massive" money laundering operation involving the use of shell companies to transfer funds to Zhongwang.
U.S. authorities said the scheme gave Liu's companies an unfair advantage over American rivals and posed other hazards.
"Our national security is jeopardized when domestic industry loses its ability to develop and supply products for U.S. defense and critical infrastructure applications, forcing us to become dependent on unreliable imports," Joseph Macias, special agent in charge for homeland security investigations in Los Angeles, said in a statement.
Liu and several other defendants face charges of wire fraud, money laundering, passing fraudulent papers through a customhouse and conspiracy.
Most counts carry a maximum 20-year prison term, and if served consecutively carry a maximum 465-year term.
The case is U.S. v Liu et al, U.S. District Court, Central District of California, No. 19-cr-00282.
#7278159 at 2019-07-31 19:22:48 (UTC+1) Q Research General #9312: [24hrs] Are We There Yet? Edition
Chinese aluminum billionaire indicted for $2 billion tariff evasion scheme: WSJ
WASHINGTON (Reuters) - Liu Zhongtian, a Chinese billionaire and the founder of aluminum giant China Zhongwang Holdings Ltd (1333.HK), has been indicted by a U.S. federal grand jury on charges that he was part of a conspiracy to evade nearly $2 billion in tariffs, the Wall Street Journal reported on Wednesday.
The indictment, which was reached in May but not unsealed until this week, alleges the scheme was hatched in 2008 and has continued to the present day, according to the newspaper, which cited prosecutors.
Reuters was not immediately able to confirm the report. China Zhongwang Holdings Ltd did not immediately respond to a request for comment.
The company is accused of using aluminum shipments to inflate its revenue, the Journal reported. Liu faces charges of fraud and money laundering that carry a maximum prison sentence of 465 years, the newspaper said.
An arrest warrant has been prepared for Liu, who is believed to be in China, the Wall Street Journal reported, citing an official with knowledge of the probe.
The indictment was unsealed as U.S. and Chinese trade negotiators attempt to end trade tensions between the two largest economies.