Business Essentials for Professionals


Carlos Ghosn Appears In Japan Court, Pleads Not Guilty

Carlos Ghosn Appears In Japan Court, Pleads Not Guilty
In his first appearance in a Japanese court after nearly 50 days behind bars, former Nissan Motor Co. Chairman Carlos Ghosn denied all allegations brought against him by the car maker of financial misconduct.
“I am innocent of the allegations made against me,” Ghosn told the Tokyo District Court in English, adding that he has been “wrongly accused and unfairly detained.”
Handcuffed and with a rope tied around his waist, Ghosn was brought to the Japanese court at around 10:30 am local time and was allowed about 20 minutes to talks in the court. .
The allegations of the prosecutors were denied by Ghosh – who had joined Nissan in 1999 and brought the company out of near bankruptcy, and said that all of the compensation that he had received from the company had been reported by him and he had never shifted any personal loss to the company accounts. 
He also stressed that it was a pleasure to work with Nissan and forgoing the alliance with Renault SA.
“I have a genuine love and appreciation for Nissan,” he said at the beginning of his remarks as reported in the local media.
The appearance attracted a crowd of about 1,000 people, including some Nissan shareholders and lawyers.
“He is a person who reformed Nissan by doing things Japanese people could not,” Masataka Obinata, 67, a Nissan shareholder who lives in Tokyo said while standing in line told the media later on. “I want to hear what statements he will make.”
The court appearance for Ghosn happened after his lawyers demanded to know from the court why Ghosn was still in custody. The lawyers and families of people under detention are allowed to make such an appeal under the Code of Criminal Procedure in Japan.
The justification of the extended detention was given by the judge and said that it was based on “flight risk” and possible “destruction of evidence” and on the basis of the statements and evidence provided to the court so far.
At the end of December, Ghosn was served another warrant alleging that the former executive had engaged in breach of trust with Nissan in relation to him transferring investment losses that he had incurred personally worth about ¥1.85 billion, to Nissan’s accounts in 2008.
There was an almost 85 per cent plunge in the share prices of Nissan during the global financial crisis which had significantly brought down Ghosn’s equity-linked assets which were used as collateral for his foreign exchange contracts. Ghosn said that his contractor, Shinsei Bank, had asked him to provide more collateral.
He said that the needed amount at that time could have been paid by him if he had collected his retirement money from Nissan after stepping down from the position of the CEO of the company.
“But my moral commitment to Nissan would not allow me to step down during that time. A captain doesn’t jump ship in the middle of a storm,” he said.
According to his admission in court, Ghosn had made a temporary transfer of the contract to Nissan to take on collateral. His legal team however argues that there were three parties who signed the contract – Ghosn’s asset management firm, Nissan and Shinsei Bankm and the contract mandated that mo costs would be incurred by Nissan.  

Christopher J. Mitchell

Markets | Companies | M&A | Innovation | People | Management | Lifestyle | World | Misc