He was a secretary to President Chiang Ching-kuo from 1979 to 1986; advisor to the Premier from 1991 to 1992; an honorary chairman of the Service Centre Across the Taiwan Strait; and a member of the National Assembly. In 1986, Chen Shui-bian was jailed for eight months for libel after his pro-opposition magazine accused, among other things, Fung of plagiarism. His argument in court was he merely translated an English book for his Doctoral Thesis. It is translation, therefore not plagiarism. The court ruled in his favor and sentenced Chen Shui-bian to jail for libel.
He ran for vice-presidency in the 2000 election as the running mate of Li Ao on the New Party ticket.
In February 2004 a Taiwan-based foreign labourers' organization publicly accused Fung of raping his Filipina housekeeper in November 2003. On July 8, 2005 the presiding judge found him guilty based on matching DNA evidence. Fung, alleging political persecution by the ruling DPP, maintains his innocence. The alleged rape victim in Philippine volunteered to appear in a video denying the rape incident. He presented the video to the court, trying to overturn the court decision against him.