Bankrupt Honolulu Charter Operator Faces Allegations Of Multimillion Dollar Fraud

Wing Spirit, the Honolulu charter operator that announced a donation of $1 million in flights to help Oahu doctors access neighbor island patients during the height of the COVID-19 pandemic, filed for bankruptcy six months after the free flight offer.

Although the October 2020 bankruptcy came at a time when the pandemic had set the airline industry into a tailspin, a storm of lawsuits filed against the company and its chief executive officer, alleging multimillion dollar fraud, points to a much different cause.

One of the biggest claims is that the fledgling charter operator’s CEO, Teijiro Handa, defrauded his business partner Japan-Aviation Academy, Japan’s oldest flight school, out of tens of millions of dollars, some of which he allegedly used to launch Wing Spirit in 2019.

In the lawsuit filed in October in Hawaii’s First Circuit Court, Handa is accused of gaining the trust of the Japanese flight academy’s chairman in order to take control of the company’s finances, ultimately “forcing” the academy to unnecessarily borrow a large amount of money from Japanese banks. The lawsuit claims Handa then paid some of that money to himself to establish Wing Spirit in Honolulu.

While Wing Spirit was getting off the ground, Japanese Aviation Academy happened to be forging a partnership with the University of Hawaii to build an aviation academy on Oahu.

Both entities signed a letter of intent establishing a five-year period for discussions toward the goal of working together to create an academic program to foster the next generation of pilots, mechanics, flight attendants and aeronautical engineers in Hawaii.

Honolulu’s Office of Economic Development saw the planned venture as a chance to create a new industry with high-paying jobs following the 2015 closure of the University of Hawaii’s flight training program at Honolulu Community College.

Preliminary discussions were underway before the COVID-19 pandemic hit, said UH spokesman Dan Meisenzahl, but he said the pandemic put the project on hold.

Parallel to the UH initiative, the Japanese flight academy in 2018 also registered a new Hawaii arm of its business — Japanese Aviation Academy of Hawaii. Handa was named the group’s president.

Wing Spirit made a splash in the Hawaii aviation scene in 2019 when it committed to purchasing 15 state-of-the-art HondaJet Elites, with a base price of about $5 million each, for the company’s high-end interisland flight and ambulance service.

The company marked the arrival of its first two Honda jets that summer with a $300,000 donation to the City and County of Honolulu and a cocktail celebration, where Honolulu’s Japanese Consulate-General Koichi Ito gave a toast to Wing Spirit’s future.

But the company came up short on funds to buy the jets outright and resorted to leasing them.

A week after Wing Spirit defaulted on a $441,000-a-month loan to lease several Honda airplanes in October 2020, the company filed for Chapter 11 bankruptcy protection. The bankruptcy filing was later converted from Chapter 11, commonly used for business reorganizations, to a Chapter 7 liquidation filing.

Other lawsuits filed in the last year allege that Wing Spirit never intended to pay the local companies it hired to design and furnish its airport terminal facility and offices. A pair of Honolulu contractors claim the company owes a combined $200,000 for services rendered.

Attorneys representing Handa and Japan Aviation Academy did not respond to requests for comment.