Detention of Nissan’s Ghosn extended through Dec. 20

By Yuri Kageyama And Mari Yamaguchi, ASSOCIATED PRESS   

Industry Automotive autos corporate governance corruption Ghosn Japan Nissan renault

Ghosn and fellow Nissan executive Greg Kelly were charged Dec. 10.

TOKYO—A Tokyo court ruled Tuesday that Nissan Motor Co.’s former chairman, Carlos Ghosn, and another executive will remain in custody through Dec. 20, more than a month after their arrest. Their detention could continue for months more under the Japanese legal system.

The Tokyo District Court said Tuesday that it had rejected a protest filed by Ghosn’s lawyer against the prolonged detention.

The court decision comes a day after Ghosn, fellow Nissan executive Greg Kelly and Nissan Motor were charged with violating financial laws by underreporting Ghosn’s pay by about 5 billion yen (US$44 million) in 2011-2015. They were arrested on Nov. 19 and are being held at a Tokyo detention centre.

Related: Prosecutors indict Nissan’s Ghosn for underreporting pay [Canadian Manufacturing]


The extension of their detention is to allow time for an investigation into additional allegations prosecutors issued Monday, against Ghosn and Kelly, of underreporting another 4 billion yen ($36 million) in 2016-2018.

The arrest of the man credited with saving Nissan when it was on the verge of bankruptcy two decades ago has stunned many and has raised concerns over the Japanese automaker and the future of its alliance with Renault SA of France.

No trial date has been set, as is routine in Japan. Prosecutors can add more allegations to extend detention, and it remains unclear when Ghosn and Kelly might be released.

The prosecutors say they consider Ghosn and Kelly flight risks.

Ghosn’s legal team has not issued an official statement, but those close to him have said he is asserting innocence. The office of Motonari Ohtsuru, one of the lawyers, declined comment, saying he was not there.

The U.S. lawyer for Kelly, Aubrey Harwell, has said his client insists he is innocent and that Nissan insiders and outside experts had advised him that their financial reporting was proper.

The maximum penalty for violating Japan’s financial laws is 10 years in prison, a 10 million yen ($89,000) fine, or both. The conviction rate in Japan is over 99 per cent.

Nissan has said an internal investigation found three types of misconduct: underreporting income to financial authorities, using investment funds for personal gain and illicit use of company expenses.

Nissan, as a legal entity, was also charged Monday. Nissan is not under supervision or being monitored, although it is co-operating with the prosecutors’ investigation, according to company spokesman Nicholas Maxfield. Nissan said in a statement that it takes the indictment “extremely seriously.” It promised to strengthen its governance.


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