Nissan and ex-Chairman Carlos Ghosn indicted in pay scandal, Kyodo reports

Ghosn, who is credited with rescuing Nissan from near-bankruptcy, could face as long as 10 years in prison if convicted.
Image: Carlos Ghosn
Carlos Ghosn, then the chairman of Nissan Motor Co., at the Paris Motor Show in September 2016.Eric Piermont / AFP - Getty Images file

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By Alex Johnson

Carlos Ghosn, who was fired last month as chairman of Nissan Motor Co., a close aide and Nissan itself were indicted Monday and accused of concealing as much as $45 million in Ghosn's income and using Nissan funds to buy personal homes abroad, the Japanese news agency Kyodo reported.

Ghosn (pronounced "Gohn"), who is already in jail in Tokyo in connection with the case, could face up to 10 years in prison if he is convicted.

The formal charges came the same day Ghosn and his former chief of staff, Greg Kelly, would have had to have been released after 22 days of detention had they not been charged or arrested under a new warrant, Kyodo reported.

Ghosn and Kelly were fired last month after Nissan said an internal investigation, prompted by a whistleblower, had found serious misconduct; they were arrested Nov. 19 on suspicion of having failed to report all of their income over five years.

Nissan said at the time that "numerous other significant acts of misconduct have been uncovered — such as personal use of company assets — and Kelly's deep involvement has also been confirmed."

Ghosn and Kelly have admitted to prosecutors that Ghosn's pay wasn't fully reported, but they claimed that it didn't have to be because it could have been recorded as compensation after his retirement, Kyodo reported, citing sources with knowledge of the investigation.

Ghosn has been credited with rescuing Nissan from near-bankruptcy in 1999, when Groupe Renault bought a stake in Nissan and installed Ghosn to turn it around after it had run up massive amounts of debt.

Nissan quickly recovered under his leadership, and Ghosn was soon elevated to chief executive not only of Nissan but also of the parent Renault-Nissan Alliance, making him a superstar in the automotive world.