The Chinese billionaire founder of metals giant Zhongwang has been indicted in the United States for his alleged role in an elaborate scheme to avoid paying $1.8 billion in tariffs on aluminum shipped to the US.

Liu Zhongtian, the former chairman of China Zhongwang Holdings, is accused of exporting huge amounts of aluminum disguised as pallets to avoid paying customs duties of up to 400 percent.

Also named in the indictment, filed in Los Angeles federal court, is the company as well as several individuals and shell companies.

"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," said prosecutor Nick Hanna.

"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."

Authorities say the scheme, started in 2008 and still operating, consisted of Zhongwang selling the purported aluminum pallets to US-based companies controlled by Liu.

The metal was simply aluminum extrusions that were spot-welded together to make them appear to be functional pallets which would be considered finished goods not subject to duties, according to the indictment.

"In reality, there were no customers for the 2.2 million pallets imported by the Liu-controlled companies between 2011 and 2014, and no pallets were ever sold," authorities said.

The bogus sales that transited through the ports of Los Angeles and Long Beach were intended to inflate the value of the Chinese metals giant, the complaint says.

It said demand for the pallets was such that "defendants Liu and China Zhongwang would direct that aluminum melting facilities be built and acquired to be used to reconfigure the aluminum imported as pallets into a form with commercial value."

The indictment came as the United States on Wednesday resumed trade talks with China that had collapsed in May.

Washington and Beijing have so far hit each other with punitive tariffs covering more than $360 billion in two-way trade in a row focused on demands for China to curb the alleged theft of American technology and provide a level playing field to US companies.

Liu and the company could not immediately be reached for comment.

The indictment charges Liu and his co-defendants with conspiracy, nine counts of wire fraud and seven counts of passing false and fraudulent papers through customs.

All of the defendants, apart from warehouse entities, also face money laundering charges.

Liu, 55, who goes by the nickname "Big Boss" and "Uncle Liu," according to the indictment, is believe to be in China, US media reports said.

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