TOKYO -- Nissan Motor Co. Chairman Carlos Ghosn was arrested on Nov. 19 by Tokyo prosecutors on suspicion of under-reporting his income in violation of the Financial Instruments and Exchange Act, according to people close to the investigation.
The prosecutors also arrested Nissan representative director Greg Kelly on suspicion of violating the same law, they said.
Investigators also searched Nissan headquarters in Yokohama south of Tokyo in connection with the case, they added.
According to his financial statement, Ghosn earned 735 million yen (around $6.52 million) in fiscal 2017. The actual amount he made was hundreds of millions of yen more, say people familiar with the matter.
Nissan announced on Nov. 19 that its months-long investigation based on whistleblower tips has revealed that Ghosn, 64, and Kelly, 62, have committed a number of wrongdoings. The company said their illicit acts include listing Ghosn's income as less than the actual amount in financial statements for years.
The carmaker also said Ghosn was involved in multiple, serious illicit acts including spending company funds for personal purposes.
The company said that a proposal will be made to the board of directors to dismiss Ghosn as chairman and representative director. A similar proposal will be made regarding Kelly, it added.
Nissan said it has been fully cooperating with the prosecutors' investigation, and will continue to do so.
Earlier in the day, Ghosn was questioned on a voluntary basis by prosecutors from the special investigation section of the Tokyo District Public Prosecutors Office, people close to the investigation said.
Born in Brazil, Ghosn joined French carmaker Renault in 1996 before he assumed the title of chief operating officer for Nissan in 1999. Ghosn became president of Nissan in June 2000 and chairman in April 2017.
(Japanese original by Kenji Tatsumi, Kazuhiro Toyama and Kim Suyeong, Tokyo City News Department)