Taipei District Court has ordered that Zhang Gangwei, chairman of the board of Far Eastern Air Transport (Taipei Sung Shan) (FEAT), be detained and held incommunicado on charges of alleged fraud, embezzlement, and false property declarations, Taiwan's Central News Agency has reported.
The court approved Zhang's detention on April 2, two days after prosecutors appealed its decision to release him on bail following a preliminary hearing.
Zhang has been under investigation since the regional carrier suspended flight operations on December 13, 2019, citing financial difficulties, laying off almost 1,000 employees. The chairman had repeatedly claimed to be in talks with investors who, he said, could inject up to TWD1 billion Taiwanese dollars (USD33.2 million) into FEAT, which was also known by the acronym FAT.
On January 31, the Taiwanese government revoked the airline's Operator's Licence (OL), and its domestic, international, and cross-strait route authorities were redistributed to other Taiwanese carriers. Prosecutors have since been probing the nature of the company's financial problems.
After being interrogated by prosecutors in the preliminary hearing at Taipei District Court on March 31, Zhang was found to have violated laws on false financial reporting, fraud, breach of trust, commercial accounting, money laundering, and unlawful suspension of business regulations. The court ordered his release on TWD8 million (USD266,000) bail, but prosecutors successfully appealed the decision in Taiwan's High Courts.
Before ceasing operations, Far Eastern Air Transport flew mostly domestically, deploying 90.7% of its scheduled capacity - or 50,100 seats per week - within Taiwan. Its core routes were to the outlying islands of Penghu and Kinmen, which it served from Taipei Sung Shan, Kaohsiung, and Taichung Ching Chuan Kang.
The airline operated six ATR72-600s, four MD-82s, and four MD-83s. The four owned MD-83s are all that remain and are currently stored, three of them in Taipei at both airports and one in Kaohsiung, according to the ch-aviation fleets module.
