Washington (AFP) – US authorities are investigating whether companies tied to a Chinese billionaire evaded punitive tariffs on aluminum imports, according to a media report on Wednesday.
Agents from the Department of Homeland Security recently questioned US companies and former employees tied to Liu Zhongtian, founder of China Zhongwang Holdings Ltd, The Wall Street Journal reported, citing knowledgeable sources.
Zhongwang aluminum products made in China are subject to import tariffs of as much as 374 percent because the US has found they are heavily subsidized.
The Commerce Department meanwhile is also investigating whether the New Jersey-based company Aluminum Shapes LLC had imported aluminum pallets — which are subject to far lower tariffs — to be melted down for raw material, according to the Journal. Aluminum Shapes has denied wrongdoing.
The DHS investigation is examining possible criminal and civil violations that may include smuggling, conspiracy and wire fraud. China Zhongwang, which describes itself as Asia’s largest producer of extruded aluminum products, has denied wrongdoing, according to The Journal.
The investigation comes as US industry has campaigned against perceived trade violations by China as the global aluminum industry struggles with massive overcapacity.
The Commerce Department said in March it was investigating allegations that China Zhongwang was transshipping aluminum to the United States via Mexico, also in a bid to avoid US import duties. The Commerce Department determined in 2010 that China Zhongwang benefited from illegal subsidies and was dumping its products on the US market.
Homeland Security did not respond to a request for comment on Wednesday.
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