Taiwan Detains 2 Drone Executives Over Chinese-Made Chips in Military Contracts

Taiwanese prosecutors have accused drone supplier Jiin Ming Industry Co. and its subsidiary of installing prohibited Chinese-made chips and camera lenses in drones supplied to Taiwan’s military, then submitting false certificates of origin during inspections, according to an Oct. 12 statement from the Taoyuan District Prosecutors Office.

The case led to the detention of Jiin Ming Vice Chairman and General Manager Chien Hao-ting and Sales Director Chen Yang-cheng. Both men are suspected of national security violations, document-related offenses and aggravated fraud, Taiwan’s Central News Agency (CNA) reported.

Searches and alleged contract violations

Investigators executed court-authorized searches at six locations on Oct. 8, including Jiin Ming, its subsidiary, a supplier and residences linked to the case. They questioned Chien, Chen, seven employees and one witness and seized materials relevant to the investigation, according to the prosecutors’ account.

Prosecutors alleged that the companies violated requirements barring components originating in China from the military contracts. They said the two executives knowingly supplied prohibited parts and used inaccurate business records and origin certificates. The suspected offenses include provisions of Taiwan’s National Security Act and Criminal Code concerning false business documents and aggravated fraud involving three or more people.

The investigation was assigned to national security prosecutor Lin Yi-wei under the direction of Taoyuan chief prosecutor Chang Chun-hui. After overnight questioning, prosecutors arrested Chien and Chen at about 3 a.m. on Oct. 9 and sought detention without visitation. The court approved the requests; the other suspects were released.

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Court cites risks of collusion and repeat offenses

In its detention ruling, the Taoyuan District Court said Chien acknowledged the conduct described in prosecutors’ detention application after initially denying it. The court cited discrepancies between his account and witness testimony, the possibility of additional accomplices and the case’s national security implications, according to CNA’s report on the decision.

Chen denied the alleged offenses, but the court found substantial grounds for suspicion and noted inconsistencies in his statements. Judges also cited risks that the two men could coordinate accounts with other witnesses or commit similar offenses again. Both were ordered held for two months beginning Oct. 9, with visits and outside communication prohibited. Each may appeal within 10 days of receiving the ruling.

In a public company disclosure, Jiin Ming said Chairman Tsai Hsiang-feng had temporarily assumed Chien’s management duties and that its operations were continuing. The company said defense-related drone orders accounted for about 1.1 percent of its overall revenue through September, and it did not expect a material effect on its financial position. It said it would cooperate with investigators.

Earlier procurement case raises supply-chain concerns

The Jiin Ming investigation follows another case involving military drones and allegedly misrepresented Chinese components. In August, prosecutors in southern Taiwan investigated Hang Jian Technology, which won a 2025 procurement contract for the army’s 8th Corps. Investigators alleged that Chinese-packaged chips, Chinese-made flight-control boards and other components were used despite origin restrictions, with markings concealed and false certificates submitted, according to CNA’s Aug. 18 report.

The 8th Corps said it identified suspected Chinese-made components during its acceptance inspection, withheld payment and referred the case to prosecutors. The contractor’s head was detained, while another company official was released, according to the Taipei Times.