Carlos Ghosn faces new charges in Japan

Prosecutors on Friday (January 11) filed two new sets of charges of financial misconduct against former Nissan chief Carlos Ghosn, Tokyo District Court said.

The auto tycoon was already facing charges for one allegation of under-reporting his pay, and the new charges accuse him of additional misreporting as well as “aggravated breach of trust” involving company funds.

Lawyers for the former jet-setting executive immediately said they would file a bail application, but have acknowledged that he will probably be detained until a trial.

Ghosn, who is reportedly suffering from a fever at his Tokyo detention center, denies any wrongdoing, arguing in a dramatic court appearance on Tuesday that he is being “wrongly accused and unfairly detained”.

He was already facing the first charge for allegedly under-reporting his compensation over five years to the tune of five billion yen ($46 million) in official documents to shareholders.

The second charge against him alleges that the under-reporting continued for another three years.

The third charge, for aggravated breach of trust, involves a complex alleged scheme under which Ghosn is said to have tried to transfer losses on foreign exchange contracts to Nissan’s books.

It also alleges that he used company funds to repay a Saudi acquaintance who put up collateral for the contracts.

Prosecutors also filed charges Friday against Nissan and Ghosn aide Greg Kelly over the additional three years of under-reporting pay.

The breach of trust charge is regarded as particularly serious, and Ghosn’s lawyer admitted Tuesday that his client was unlikely to secure bail if prosecutors pressed the charge formally.

It would be “very difficult,” said Motonari Otsuru.

“In general in such cases in Japan, it is indeed the case that bail is not approved before the first trial does take place,” he said, adding that it could be six months before the case comes before a judge.

The arrest of the 64-year-old has exposed rifts in the alliance he forged and led between Nissan, Mitsubishi Motors and France’s Renault.

While the two Japanese firms quickly ousted him from leadership roles, Renault has kept him on and its board said Thursday that an ongoing audit has found no sign of fraud in the last two years.

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