Carlos Ghosn and Nissan charged over pay allegations

Time 10:43 am, December 10, 2018

FORMER Nissan chairman Carlos Ghosn, another executive and the carmaker itself were today charged by prosecutors in Tokyo with under-reporting income.

The charges involve allegations that Ghosn’s pay was under-reported by about five billion yen (circa £34m) over five years. In Japan, a company can be charged with wrongdoing.

The prosecutors had said earlier that the allegations were behind the 64-year-old’s arrest on November 19.

They added a new set of allegations today against Ghosn and another executive, Greg Kelly, of under-reporting another four billion yen (circa £28m) for more recent years. Nissan as a company wasn’t mentioned in the latest allegations.

Some kind of action by the prosecutors had been expected because the detention period allowed for the allegations disclosed earlier was to end today.

Greg Kelly

Kelly, 62, is suspected of having collaborated with Ghosn. His lawyer in the US said he was asserting his innocence.

Ghosn, who hasn’t commented, has been ousted as Nissan chairman and Kelly lost his representative director title following their arrests, but they both remain on the board.

Ghosn was sent to Nissan by its partner Renault SA of France in 1999 and led a dramatic turnaround of the near-bankrupt Japanese carmaker. But his star-level pay drew attention, since executives in Japan tend to be paid far less than their international counterparts.

Only Ghosn’s lawyers and embassy officials from Lebanon, France and Brazil, where he has citizenship, have been allowed to visit him.

Nissan said in a statement: ‘Nissan takes this situation extremely seriously. Making false disclosures in annual securities reports greatly harms the integrity of Nissan’s public disclosures in the securities markets, and the company expresses its deepest regret.’

The statement said Nissan would work to improve its corporate governance and compliance, ‘including making accurate disclosures of corporate information’.

Meanwhile, the Securities and Exchange Commission said that it had filed criminal complaints against Ghosn, Nissan and Kelly.

A commission official said today that Nissan, Ghosn and Kelly were suspected of falsifying reports on millions of dollars’ worth of Ghosn’s income.

MORE: Japanese court extends Carlos Ghosn’s custody again

MORE: Nissan’s board sacks Carlos Ghosn

MORE: Carlos Ghosn arrested on suspicion of financial misconduct

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