Ghosn Denies Nissan’s Claims, Kelly Admits Post-Retirement Payouts

Rabat – Speaking to Tokyo prosecutors during questioning, Ghosn denied underreporting his remuneration in Nissan’s securities reports, sources told the Japanese public broadcaster NHK on Sunday.

The 64-year-old told prosecutors he “had no intention” of falsifying the financial statements.

Ghosn reportedly argued that Nissan was responsible for salary reports. He said the Japanese carmaker “made decisions on how much pay would be declared in securities reports.”

Japan arrested both Ghosn and his aide, former Nissan representative director Greg Kelly, last Monday on suspicion of underreporting Ghosn’s compensation by tens of millions of dollars over an 8-year period. Nissan also suspects Ghosn of using company funds for personal expenses as well as other financial misconduct.

Sources said Nissan decided to pay Ghosn around $17 million a year, but that only half of the sum was reported in the securities report.

Read also: Japan Extends Ghosn’s Custody as Financial Misconduct Scandal Persists

Kelly admits post-retirement payout plan

Ghosn is suspected of giving instructions to Kelly to report that his annual income was about $9 million, according to NHK sources.

The sources added that the compensation “was arranged so that the difference between the reported sum and actual compensation, totaling about 72 million dollars, would be paid to Ghosn after his retirement as a bonus, as well as consulting and other fees.”

Kelly, according to NHK, admitted yesterday that “post-retirement payouts were arranged for Ghosn.”

Kelly said, “Ghosn’s post-retirement payouts didn’t need to be reported in his securities statements since they were yet to be formally arranged,” sources told NHK.

Read also: Nissan Board Dismisses Carlos Ghosn as Chairman

Japan requires high-income corporate executives to report their post-retirement payouts in their securities reports when the total sum is decided.

People who violate Japan’s Financial Instruments and Exchange Act could face up to 10 years in prison and/or a fine of up to $88,500.

Nissan’s board of directors ousted Ghosn as chairman and Kelly as representative director on Thursday, November 22.

Ghosn is also CEO of Renault and visited Morocco in October to review Renault’s plant expansion plans. In response to Ghosn’s arrest, Renault appointed COO Thierry Bollore as temporary CEO.