Carlos Ghosn: Former Nissan chairman charged with financial misconduct by Tokyo prosecutors

Company expresses 'deepest regret' after new allegations emerge

Zamira Rahim
Monday 10 December 2018 10:07
Carlos Ghosn was arrested on 19 November
Carlos Ghosn was arrested on 19 November

Prosecutors in Tokyo have charged the former chair of Nissan with underreporting his income by five billion yen (£35m).

Along with the motoring titan Carlos Ghosn, Nissan itself and an executive Greg Kelly were charged for understating the pay, which was received over five years.

In Japan, a company can be charged with wrongdoing.

A US finance official said that Nissan, Ghosn and Kelly were suspected of falsifying millions of dollars worth of Mr Ghosn’s income.

They are accused of violating Japan’s Financial Instruments and Exchange Act by making false disclosures in annual securities reports.

Ghosn was arrested on 19 November. The detention period allowed for the earlier allegations was due to end on Monday.

As well as charging Ghosn, the prosecutors have added a new set of allegations against him. Ghosn has not commented on those.

The 64-year-old, alongside Mr Kelly, is accused of underreporting a further four billion yen.

Nissan is not accused as a company in the latest allegations.

Greg Kelly, who lost his title of representative director following his arrest, is maintaining his innocence.

Ghosn was ousted as chair following the scandal, but both men remain on Nissan’s board.

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

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Ghosn joined Nissan as its chief operating officer in 1999 and was credited for leading a dramatic turnaround of the Japanese company, which was nearly bankrupt at the time.

He served as CEO from 2001 and 2017 and drew attention for his high pay.

Executives in Japan tend to be paid far less than their international counterparts.

“Nissan takes this situation extremely seriously,” the company said in a statement.

“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.”

Additional reporting by agencies

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