Ghosn Formally Indicted

Carlos Ghosn and Nissan, the Japanese automaker he saved from collapse, were indicted Monday on allegations of financial misconduct, deepening a crisis that already brought down one of the global car industry’s most iconic figures.
Tokyo prosecutors said they indicted Ghosn, 64, and Nissan for under-reporting his income over a five-year period and are investigating allegations that the practice went on for even longer.
Ghosn’s sudden downfall began when he was arrested in Tokyo last month. He has since been ousted as chairman of Nissan (NSANY) and Mitsubishi Motors (MMTOF) and temporarily replaced as head of France’s Renault (RNSDF).
Former Nissan director Greg Kelly, who was arrested in Tokyo at the same time as Ghosn, was also indicted Monday, prosecutors said.
The two men are alleged to have collaborated to under-report Ghosn’s income in Nissan’s securities filings by about 5 billion yen ($44 million) over a five-year period ending in March 2015, according to prosecutors. The maximum punishment in Japan for filing a false financial statement is up to 10 years in prison and a fine of up to 10 million yen ($89,000).
“Nissan takes this situation extremely seriously,” the company said in a statement. “Making false disclosures in annual securities reports greatly harms the integrity of Nissan’s public disclosures in the securities markets, and the company expresses its deepest regret.”
It added that it “will continue its efforts to strengthen its governance and compliance, including making accurate disclosures of corporate information.”
Shares in Nissan dropped nearly 3% in Tokyo.
Ghosn’s downfall has strained the global autos alliance between Nissan, Renault and Mitsubishi Motors.
Renault, which has appointed an acting chief executive but kept Ghosn in his positions of CEO and chairman, said it has not been provided with evidence of wrongdoing.