8:50 am, September 16, 2020
The trial of former Nissan executive Greg Kelly over allegations of financial misconduct has begun in Tokyo, Japan.
Kelly is alleged to have had a role in failing to report to Japanese authorities the future compensation of ex-chairman Carlos Ghosn.
Japanese prosecutors outlined allegations of what they said was a complex and clandestine scheme to pay Ghosn tens of millions of pounds after retirement.
Kelly denied the allegations and said everything that was done was intended to keep Ghosn, who he called an ‘extraordinary executive’, at Nissan.
‘This was all in the best interests of Nissan,’ Kelly said, reading from a statement.
‘I deny the allegations. I was not involved in a criminal conspiracy,’ said Kelly, whose trial opened on his 64th birthday.
Ghosn led Nissan for two decades but was arrested along with Kelly in November 2018, but jumped bailed and was smuggled out of Japan to Lebanon late last year.
At the time Ghosn said he was innocent and was the victim of conspiracy carried out by rival executives, and that he would not get a fair trial in Japan.
According to The Times, Ghosn was also charged with using Nissan to cover personal trading losses with the help from a Saudi businessman and paying himself $5m of company money, disguised as a reward for a Middle Eastern car showroom.
The charges being read in Kelly’s trial are related to alleged criminal activity in reporting Ghosn’s compensation.
Prosecutors say Ghosn and Kelly broke Japanese corporate reporting laws by attempting to conceal 9.2bn yen of ‘deferred compensation’, says The Times.
The ‘compensation’ was to be paid to Ghosn after his retirement, in order to make his pay packet look less lavish, it’s alleged.
The money should have been declared, say prosectors.
During the trial, Kelly recounted how in the late 1990s, when Nissan was losing money, the French automaker Renault bought a stake in Nissan and sent in Ghosn to help turn the ailing Japanese car manufacturer around.
The experts believed Nissan was doomed, Kelly said, but ‘Mr Ghosn proved the experts wrong. Under Mr Ghosn, Nissan became very profitable’.
Top management at Nissan fretted they might lose Ghosn, who occasionally complained he could make more money elsewhere.
They researched lawful methods to provide incentives for him to say, consulting with in-house and outside attorneys to try to retain him.
‘The evidence will show that I did not break the law,’ said Kelly, who has a law degree and was hired by Nissan in the US in 1988.
Kelly’s head defence lawyer Yoichi Kitamura said little apart from: ‘My client is not guilty.’
Nissan is also facing the same charges in the trial as Kelly but has acknowledged guilt and is not contesting. It is paying a 2.4bn yen (£17.57m) fine.
The trial could last for a year or more, and if convicted Kelly could face up to 10 years in jail.
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