Nissan to oust Ghosn over financial misconduct allegations

Roman Schwartz
November 19, 2018

Japanese media reported that Ghosn, who is also chairman and chief executive of Nissan's French partner Renault and one of the best known figures in the global vehicle industry, had been arrested.

Nissan Motor Co.'s high-flying chairman Carlos Ghosn is to be dismissed after the company said an internal investigation found he under-reported his income by millions of dollars and engaged in other "significant misconduct".

Among the most prominent car-industry executives globally, Ghosn, 64, built the three-way union of Renault, Nissan and Mitsubishi Motors Corp.

But Japanese newspapers reported this morning that he is set to be arrested in Tokyo on suspicion of manipulating financial reports.

In a statement, Nissan said it had been conducting a probe into Ghosn for several months after receiving a whistleblower report and had uncovered misconduct going back several years.

Ghosn then became chairman of the board of that automaker as well, and vowed to revive it by integrating Mitsubishi Motors into the Renault-Nissan manufacturing alliance.

Nissan said it had launched an investigation into both Ghosn and Representative Director Greg Kelly several months ago.

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Nissan said it was providing information to the prosecutors and co-operating with their investigation.

The news rattled the European equity market, with shares of Renault falling as much as 15 percent in Paris, while Nissan's global depository receipts sank more than 11 percent.

Both Ghosn and Kelly were reporting compensation to securities regulators in Tokyo that was less than the actual amount, Nissan said, adding that they did this to reduce Ghosn's disclosed compensation.

Public broadcaster NHK reported that Tokyo prosecutors were raiding Nissan's headquarters in the city of Yokohama.

Brazilian-born, of Lebanese descent and a French citizen, he began his career at Michelin in France, moving on to Renault.

He served as Nissan's chief executive from 2001 until April 2017, becoming chief executive of Renault in 2005, leading the two major automakers simultaneously. Ghosn remained in that post till past year.

A spokesman for Renault couldn't be reached for immediate comment. But plans for an orderly succession - and potentially the entire future of the rather unwieldy Renault-Nissan-Mitsubishi structure - may well have been thrown wide open. Nissan found itself in the midst of a controversy past year, when Japan's regulators discovered uncertified inspectors were approving vehicles, leading to a recall of more than 1.2 million cars.

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