Japanese prosecutors close case against American in Ghosn trial

Japanese prosecutors have accused former Nissan executive Greg Kelly of joining a “plot” to illegally pay his former boss Carlos Ghosn, as they finished their pleadings in a year-long trial.

“This unpaid compensation existed is clear,” prosecutor Yukio Kawasaki told the Tokyo District Court on Wednesday.

Kelly, a 30-year veteran with the Japanese automaker, was living in the United States when he was arrested in November 2018 while returning to Japan to attend a meeting.

The first American to be named to the Nissan board of directors, Kelly says he is innocent. He sat calmly in the courtroom, dressed in his usual red tie and dark suit, alongside the defense attorneys.

Kelly told The Associated Press in an interview last month that he did not know all the details of Ghosn’s compensation, but was determined to retain Ghosn, the former chairman of Nissan, due to his extraordinary management skills.

Ghosn was arrested along with Kelly and also maintains his innocence. He escaped his bail at the end of 2019 and fled to Lebanon, the country of his ancestors. He does not have an extradition treaty with Japan.

The charges focus on a pay cut of around 1 billion yen (£ 6.5million) per year which Ghosn voluntarily started taking from 2010, cutting his pay in half after the disclosure of the high executive pay has become mandatory in Japan.

Neither party disputes this cut. The controversy centers on whether this money should have been declared as compensation as a de facto pledged sum under a binding contract, or did not need to be disclosed until such time. ‘it is finalized.

Nissan officials have considered various ways to make up for the money Ghosn abandoned, such as paying him consultation fees after his retirement.

They also thought about other methods such as payments through subsidiaries and stock options. Nothing had been paid at the time of the arrests.

Carlos Ghosn in 2000 (Andrew Stuart / PA)

Ghosn said a group of Nissan had organized his arrest because he feared that French automaker Renault, which owns 43% of Nissan, would take control over the company. Other Nissan officials made similar comments during Kelly’s trial.

Renault sent Ghosn to Nissan in 1999 to lead its rescue on the verge of bankruptcy. He successfully led the maker of the Leaf electric car and luxury Infiniti models for nearly two decades.

Ghosn has also been charged with allegations of breach of trust centered on the use of Nissan’s money for personal gain, ranging from housing, his children’s school fees, to the use of a jet. business and purchases such as a chandelier. Ghosn said they were needed for the job.

Nissan, based in Yokohama, as a company and a legal person, was also indicted and pleaded guilty.

If found guilty of breaking the Financial Instruments and Foreign Exchange Act, Kelly could face up to 15 years in prison. The verdict of a three-judge panel is not expected until March of next year.

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