TOKYO -- Greg Kelly, the representative director of Nissan Motor Co. arrested with Chairman Carlos Ghosn for his part in underreporting the executive's salary, appears to have instructed at least one foreign executive officer in charge of legal affairs and others to falsify financial statements, those familiar with the matter have disclosed.
The special investigation unit of the Tokyo District Public Prosecutors Office is now investing Kelly, 62, on suspicion that he played a large role in Ghosn's violation of the Financial Instruments and Exchange Act in aiding the Nissan chairman in underreporting his income by around 5 billion yen.
Kelly, who holds certification to practice law, joined the North American branch of Nissan in 1988. Those close to the situation say that after Kelly rose to the rank of executive officer in Nissan in 2008, he has played an important role as Ghosn's "confidant," and was promoted to representative director in 2012. Nissan President Hiroto Saikawa said at a Nov. 19 press conference that Kelly "used his relationship (with the chairman) to control the workings inside the company. In that way, he had tremendous sway over the firm."
According to those familiar with the situation, the executive officer Kelly instructed to carry out the falsification has a possibility of being related to the purchase of homes used by Ghosn, the cost of which was covered completely by Nissan. The special investigation unit applied the new Japanese plea bargain system to this officer, promising to reduce their criminal punishment in exchange for evidence that backs up the wrongdoings allegedly carried out by Ghosn and Kelly.
The plea bargain system has already long been in use in Europe and North America, but the system was only introduced into Japan this June. The system is expected to be used as an investigation tool to gain the cooperation of subordinates to gather evidence to charge higher level individuals in corporate crimes. The Nissan case is a typical example of how the system is put into practice.
Ghosn and Kelly are suspected of misreporting Ghosn's remuneration five times over the four years up until June 2015 to the Kanto Local Finance Bureau. While the actual amount of Ghosn's compensation from the fiscal period from March 2010 to March 2015 totaled roughly 9.998 billion yen, it was reported at a total of some 4.987 billion yen in a financial disclosure statement submitted to the bureau. Kelly and Ghosn were arrested by the special prosecutor unit on Nov. 19 on suspicion of falsifying the statement.
(Japanese original by Kenji Tatsumi, Kazuhiro Toyama and Kim Suyeong, City News Department)