Ex-Nissan boss Ghosn slams new arrest

‘UNETHICAL CONDUCT’::Prosecutors said that Carlos Ghosn betrayed his duty to Nissan to benefit himself after he was rearrested in connection with cash transfers


Fri, Apr 05, 2019 - Page 10

Former Nissan Motor Co chairman Carlos Ghosn was rearrested yesterday in Tokyo on fresh financial misconduct allegations, with the auto tycoon calling his detention “outrageous and arbitrary.”

Authorities arrested the 65-year-old less than a month after he was freed on bail following more than 100 days in detention, the latest twist in a case that has gripped Japan and the business world since November last year.

Ghosn was detained at the central Tokyo apartment he has called home since his release on bail, with local media later reporting he had been transferred to the Kosuge detention center.

“Why arrest me except to try to break me? I will not be broken,” Ghosn said in a statement issued through his representatives. “My arrest this morning is outrageous and arbitrary.”

Prosecutors said Ghosn had been detained over transfers of Nissan funds totaling US$15 million between late 2015 and the middle of last year.

They suspect that US$5 million of that amount was used by Ghosn for personal expenditure.

“The suspect ... was responsible for overseeing the whole of Nissan’s operations and performing his duty loyally so as not to cause losses to Nissan, but he betrayed that duty in order to benefit himself,” prosecutors said in a statement.

Ghosn’s lawyer told reporters that prosecutors were engaging in “hostage justice.”

“It’s extremely unfair,” Junichiro Hironaka told local media.

Reports emerged this week that Japanese prosecutors were investigating transfers by Ghosn of more than US$30 million of Nissan funds from 2012.

That came after news that Renault SA, which Ghosn also once headed, had handed French prosecutors documents showing the auto tycoon had authorized suspicious transfers worth millions of euros.

The former high-flying executive already faces three charges in Japan of financial misconduct related to allegations he under-reported his compensation and sought to transfer personal investment losses to Nissan’s books.

He has denied any wrongdoing and took to Twitter for the first time on Wednesday to announce plans to “tell the truth” at a news conference on Friday next week.

His arrest makes that event unlikely.

Prosecutors can hold Ghosn for up to 22 days while they investigate the new claims before he can seek bail again.

A Nissan spokesman said the firm’s internal probe had uncovered “substantial evidence of blatantly unethical conduct” and that their focus was on “addressing weaknesses in governance that enabled this misconduct.”

Ghosn faces two separate charges of deferring his salary to the tune of ¥9 billion (US$81 million) and not revealing this in official documents to shareholders.

The Brazil-born pioneer of the auto sector also faces a charge of seeking to shift personal investment losses onto Nissan’s books and then using company funds to pay a Saudi Arabian associate who stumped up collateral for him.