Former CEO allegedly transferred $23 million in losses to the automaker
Carlos Ghosn, the former CEO and chairman of Nissan, has been rearrested on fresh charges, with Japanese prosecutors accusing him of hiding personal trading losses with funds from the automaker.
Prosecutors have informed Japanese news outlets Ghosn has been rearrested on aggravated breach of trust charges.
They allege Ghosn transferred ¥1.85 billion ($23 million) in losses he suffered during the 2008 global financial crisis to his employer.
Sources have told the Nikkei Asian Review Ghosn invested a sizeable portion of his personal wealth in currency derivatives.
As the yen appreciated during the financial crisis, Ghosn stood to lose billions of yen. Instead of adding more collateral as his bank requested, he allegedly gave the rights to the derivatives, including any potential losses, to Nissan.
According to prosecutors, Ghosn abused his position as Nissan’s CEO and breached the company’s trust by shifting his personal losses to the corporation.
In Japan there is a seven-year statute of limitations for violations of the Companies Act, but prosecutors argue this does not apply to Ghosn due to the amount of time he has spent out of the country.
Earlier this week the courts took the unusual step of denying a request from prosecutors to keep Ghosn in detention. In response his lawyers were preparing to file for bail, but Ghosn’s rearrest on fresh charges essentially prevents that from happening.
Ghosn and fellow director Greg Kelly were arrested in Japan in the middle of November after Nissan accused the pair of understating Ghosn’s income, and inappropriately using corporate investment funds and company expenses.
At the time of his arrest, Ghosn was the chairman of Nissan and Mitsubishi Motors, as well as the CEO of Renault and the Renault Nissan Mitsubishi Alliance.
He has since been removed as chairman of the Japanese firms, while the CEOs of all three automakers have agreed to share the role of Alliance CEO.
Ghosn remains nominally the CEO of Renault, with COO Thierry Bollore taking over his responsibilities temporarily.
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