Head of Renault-Nissan-Mitsubishi Alliance Arrested for Financial Misconduct

by David Mowatt
Former Renault-Nissan-Mitsubishi Alliance CEO

Carlos Ghosn, Chairman and CEO of the Franco-Japanese strategic partnership Renault-Nissan-Mitsubishi Alliance, was arrested in Tokyo today for financial misconduct.

Ghosn, along with Nissan director Greg Kelly, were arrested earlier today for “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.”

Following the arrest, Nissan confirmed that they were alerted of Ghosn and Kelly’s misconduct by a whistleblower report that included allegations of other inappropriate operations, “such as personal use of company assets, and Kelly’s deep involvement has also been confirmed.”

The automaker is working closely with the Japanese Public Prosecutors Office, and are already moving to remove Ghosn and Kelly from the board.

In their recent press release, the automaker stated:

“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 and Kelly’s arrest and subsequent termination come as huge blow to the automaker, and it is uncertain how drastically the scandal will effect the future of the Renault-Nissan-Mitsubishi Alliance. Earlier this month, we reported on the automaker’s partnership with electric vehicle battery startup Enevate Corporation, as well as the island country Malta’s utilization of Renault ZOE models into their first ever car-sharing club. While details regarding the scandal are still surfacing, we expect to learn more information in regards to Ghosn and Kelly’s misconduct in the following weeks.

Source: CNBC

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