TOKYO -- The next stop for former Nissan Motor Co. Chairman Carlos Ghosn following his indictment on three charges is the courtroom, but while allegations that the top businessman misappropriated the carmaker's funds smolder, one individual related to the company has told the Mainichi Shimbun, "There are still many things left uncovered."
On Jan. 11, Ghosn, 64, was indicted on a charge of aggravated breach of trust against Nissan for allegedly wiring Saudi Arabian businessman Khaled Al-Juffali about 1.3 billion yen of the automaker's funds for personal reasons. The indictment brings the charges against Ghosn to three, including two counts of breaking the Financial Instruments and Exchange Act for suspected underreporting of his annual remuneration. But there are still suspicions that Ghosn used company funds for other personal uses, and eyes are now trained on the Tokyo District Court, which is set to rule on his release from his long period of detention.
"The flow of the funds Mr. Ghosn moved is complicated," an individual related to Nissan told the Mainichi Shimbun. "We know the first destination of the transfer, but there are cases where we cannot track the movement of the money after that. It's difficult to see the whole picture."
According to the individual, under Ghosn's orders, subsidiary Nissan Middle East transferred roughly 3.5 billion yen to a representative Nissan dealer in Oman and another some 1.7 billion yen to a Lebanese representative dealership. The operators of both businesses were acquaintances of the former chairman. The source of the funds was the same as in the case of the money sent to Al-Juffali, coming from a "CEO reserve fund" over which Ghosn, who was also the CEO, could use freely.
In addition, there are suspicions that 12.2 million euros, some 1.5 billion yen, was transferred from the Oman dealer to a shell company owned by Ghosn's wife via another shell company. His wife's company purchased a yacht, which the former chairman could have used. At Ghosn's direction, false expenditure names were given to the transfers, and it appears that the mastermind behind them was a foreign former executive officer close to the chairman. Currently, the individual is serving on the board of major French carmaker Renault.
Ghosn has stated that there was absolutely nothing fraudulent about these payouts. However, there are many cases where the cash flows involved foreign shell companies, and the full picture of the former chairman's actions may be on a scale that exceeds the reach of Tokyo prosecutors' domestic investigations. The special investigative unit is currently waiting for replies to requests for cooperation made to foreign authorities, but a top official in the prosecutors' office disclosed, "Just how much evidence we will be able to gather is unknown."
In a related development, it was found on Jan. 11 that Ghosn received roughly 1 billion yen in remuneration from a joint Nissan-Mitsubishi Motors Co. company, "Nissan-Mitsubishi B.V." set up in the Netherlands in June 2017. It was also discovered that a top executive at Renault close to Ghosn was also paid an unexplained sum from a three-way joint company of the automakers, "Renault-Nissan B.V." Both payments were uncovered during an internal investigation at Nissan, and reported at a board meeting of the automaker on Jan. 10.
According to an individual familiar with the situation, the sum of nearly 1 billion yen was paid to the former chairman between April and November 2018. Nissan is considering filing a criminal complaint or taking other action against Ghosn on the basis that the undisclosed remuneration caused damage to the automaker.
Meanwhile, Renault-Nissan B.V. paid Renault Executive Vice President Mouna Sepehri undisclosed remuneration totaling 500,000 euros (roughly 62 million yen) over a five year period from 2012 to 2016. Sepehri is close to Ghosn, and also serves as a board member at Renault-Nissan B.V.
It is said that Ghosn and others signed off on the payouts, and Nissan is moving forward with investigations of these unclear movements of company funds.
According to Ghosn's lawyer, the high fever the chairman ran on the night of Jan. 9 has fallen. Additionally, the lawyer of former Nissan representative director Greg Kelly, 62, who was indicted with Ghosn on the two charges of violating the Financial Instruments and Exchange Act, said that the former executive underwent the neck surgery that he required at a hospital in Ibaraki Prefecture after being released on bail on Dec. 25 last year, and has since left the hospital.
(Japanese original by Akira Hattori, Akira Okubo and Tomohiro Katahira, City News Department, and Naoya Matsumoto and Mikako Yokoyama, Business News Department)