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Carlos Ghosn formally charged with financial misconduct

media Carlos Ghosn appearing in a Japanese news bulletin, 20 November 2018. AFP/Toshifumi Kitamura

Japanese prosecutors laid formal charges of financial misconduct on French businessmen Carlos Ghosn on Monday, nearly a month after the former chair of car giant Nissan was arrested and jailed.

Prosecutors charged Ghosn for under-reporting his salary and also extended his jail term on a set of new allegations.

It is the latest twist in the extraordinary downfall of the 64-year-old Franco-Brazilian-Lebanese executive, who had won acclaim in Japan for saving auto giant Nissan from bankruptcy.

Ghosn was arrested on 19 November on suspicion of conspiring to understate his compensation by some five billion yen (about 39 million euros) between 2010 and 2015.

Nissan and Mitsubishi Motors, the two Japanese firms in the alliance with French carmaker Renault, both sacked Ghosn as chair shortly after the arrest.

The new allegations claim Ghosn understated his income by a further four billion yen (about 31 million euros) from 2015 to 2018, as well.

Greg Kelly, former representative director, was also to remain in custody over the same charges. Prosecutors can keep Ghosn and Kelly in jail for another 22 days.

Nissan indicted for financial misdeeds

Officials also indicted Nissan for filing false financial statements. The car giant said it took the situation 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,” it said in a statement.

Shares in the company dropped 2.90 percent in trading on Monday.

Ghosn retains his seat at Renault for the time being, although the French company has appointed an interim chairperson.

Renault, Nissan and Mitsubishi Motors said last month they were fully committed to the alliance.

Ghosn criticised for lifestyle

Ghosn has been celebrated in Japan for his role in rescuing Nissan and rebuilding it as a money-making subsidiary of the much smaller French company Renault, which now owns 43 percent of the Japanese carmaker.

Honours include being made the hero of a manga comic book series called The True Story of Carlos Ghosn, as well as having a bento box named after him at some Tokyo restaurants.

But he has also been criticised for living a perceived lavish lifestyle, and some Japanese media have reported that he has six private residences in Tokyo, Paris, Rio de Janeiro, Amsterdam, Beirut and New York.

Nissan is appealing to a Brazilian court to block access by Ghosn’s representatives to a luxury apartment on Copacabana Beach in order to protect potential evidence.

While investigators have the means to keep Ghosn in jail until after Christmas, it is not clear if he will be bailed before a trial.

It could take years before reaching a final judgment.

If found guilty, Ghosn could face a 10-year prison sentence.


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