U.S. files asset forfeiture lawsuit against California aluminum producer

The federal government has filed a complaint against California-based firm Perfectus Aluminum, alleging illegal imports of more than 2 million pallets of aluminum between 2011 and 2014.    The U.S. Justice Department has filed a complaint against California-based Perfectus Aluminum Inc, alleging the company illegally imported aluminum from China, thus evading $1.5 billion in tariffs, according to the asset-forfeiture complaint  filed Thursday, Sept. 14.
   According to the complaint, the company’s warehouses in San Bernardino, Riverside and Orange counties held more than 2.1 million pallets of finished goods between 2011 and 2014. The complaint alleges that the pallets were never intended to be used as or sold as pallets, but rather to melt the aluminum and sell it as unfinished, to be shaped into products.
   The federal government alleges “that Aluminum Shapes was purchased, at least in part, for the purpose of melting Zhongtian Liu’s and Perfectus’s stockpile of bogus aluminum ‘pallets’ into aluminum billet, for sale in the United States,” the complaint said. “These pallets were not marketable or suitable for use as pallets,” the complaint said. “Rather, they were manufactured as a ruse to avoid paying customs duties upon importation into the United States.”
   According to the government’s complaint, Chinese national Zhongtian Liu is the founder and chairman of China Zhongwang, which makes the aluminum bars, tubes and other parts that can be made into finished products. Liu also controls Perfectus Aluminum, the complaint says.
   Aluminum Shapes, based in New Jersey, is owned by Jacky Cheung, who has also served as Perfectus Aluminum’s CEO since at least January 2017, the government stated.
   According to California media outlet the Daily Bulletin, the aluminum pallets were “stacked high in the four Southern California warehouses – so high, in fact, that one fire inspector wrote a citation at the Fontana facility.”
   The warehouses gained more attention from authorities when a stock trader accused China Zhongwang of fraudulent market practices, the Daily Bulletin said.
   “China Zhongwang then decided to export the aluminum to Vietnam, melt it down there and return it to the U.S. as Vietnamese aluminum, which would not be subject to tariffs,” the Daily Bulletin reported.
   The federal government imposed additional import duties on aluminum materials from China in 2010, after an investigation found the dumping of aluminum imports in the U.S. at less than fair value was materially injuring the U.S. domestic aluminum industry. Shortly thereafter is when Perfectus Aluminum began illegally importing aluminum into the U.S., the complaint alleges.