Nissan Chairman Carlos Ghosn has reportedly been arrested for financial misconduct. The automaker has also released a statement saying the executive will be removed from his role with the company quickly.
It turns out Nissan has been conducting an internal investigation on Ghosn for some time now after whistleblower reports suggested misconduct. The investigation also covered Nissan Representative Director Greg Kelly, according to a Reuters report.
Not all of the allegations have been made public, but among them is that Ghosn under-reported his compensation to Japanese authorities for “several years.” Other less detailed allegations suggest personal use of company funds, but exactly how he supposedly engaged in such behavior is unknown.
Nissan has released the following statement regarding the matter.
Based on a whistleblower report, Nissan Motor Co., Ltd. (Nissan) has been conducting an internal investigation over the past several months regarding misconduct involving the company’s Representative Director and Chairman Carlos Ghosn and Representative Director Greg Kelly.
The investigation showed that over many years both Ghosn and Kelly have been reporting compensation amounts in the Tokyo Stock Exchange securities report that were less than the actual amount, in order to reduce the disclosed amount of Carlos Ghosn’s compensation.
Also, in regards to Ghosn, numerous other significant acts of misconduct have been uncovered, such as personal use of company assets, and Kelly’s deep involvement has also been confirmed.
Nissan has been providing information to the Japanese Public Prosecutors Office and has been fully cooperating with their investigation. We will continue to do so.
As the misconduct uncovered through our internal investigation constitutes clear violations of the duty of care as directors, Nissan’s Chief Executive Officer Hiroto Saikawa will propose to the Nissan Board of Directors to promptly remove Ghosn from his positions as Chairman and Representative Director. Saikawa will also propose the removal of Greg Kelly from his position as Representative Director.
Nissan deeply apologizes for causing great concern to our shareholders and stakeholders. We will continue our work to identify our governance and compliance issues, and to take appropriate measures.
Ghosn became COO of Nissan-Renault back in 1999 after forming the alliance between the two automakers. He came CEO of the Alliance back in 2001, effectively saving the company from death with dramatic cost-cutting measures.
In 2016 he became Chairman after adding Mitsubishi to the Nissan Renault Alliance.