Nissan Chairman Carlos Ghosn has been Arrested Over Financial Misconduct

Nissan Chairman Carlos Ghosn has been Arrested Over Financial Misconduct

TOKYO — The Nissan chairman, Carlos Ghosn, was arrested on Monday after an internal company investigation found that he had underreported his compensation to the Japanese financial authorities for several years.

Nissan said it was cooperating with Japanese prosecutors. It also said that it had opened its inquiry after a whistle-blower alleged that Mr. Ghosn had been misrepresenting his salary as well as using company assets for personal use. Both he and a director, Greg Kelly, who was also accused of misconduct, were taken in by authorities, the company said.

It is a remarkable tumble for Mr. Ghosn, who arrived at Nissan in 1999 after Renault, the French carmaker, bought a large stake in the Japanese company. It may prove to be an ignominious final chapter in the career of one of the most powerful and highly regarded executives in the automotive industry.

Earlier in the day, Nissan said in a statement that Mr. Ghosn and Mr. Kelly had been involved in misconduct and recommended that both be removed from their positions. Neither Mr. Ghosn nor Mr. Kelly could be reached for comment.

Mr. Kelly, who spent years working in Nissan’s human resources department, was appointed to the automaker’s board in 2012, the first American to hold the role.

According to Nissan’s securities filings, Mr. Ghosn was paid 735 million yen, about $6.5 million, in cash in 2017, down 33 percent from the ¥1.1 billion he was paid in 2016.

The disclosure raised questions about Mr. Ghosn’s role as chief executive of the Renault-Nissan-Mitsubishi Alliance. Although he stepped down from the top job at Nissan last year, Mr. Ghosn, 64, has remained at the top of the world’s largest automotive alliance and told reporters as recently as last month that he planned to stay in that post until 2020. Mr. Ghosn was paid ¥227 million in cash and stock options by Mitsubishi Motors last year.

Renault shares tumbled 10 percent on the Paris Stock Exchange, while Nissan shares in Düsseldorf, Germany, fell 9 percent.

“Nissan deeply apologizes for causing great concern to our shareholders and stakeholders,” the company said.

Originally Published by New York Times

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