Nissan report says more heads will roll; Ghosn's Japan lawyers quit case

Tokyo

NISSAN Motor Co has revealed more details of its year-long probe into Carlos Ghosn, a week after its fugitive former leader accused the Japanese carmaker of being behind the plot to have him arrested.

The investigation has found that many others were involved in improprieties besides Ghosn, both in Japan and overseas. Three unidentified people in senior roles have been punished for their involvement, according to a report submitted to the Tokyo Stock Exchange by company on Thursday.

Nissan was required to submit the report to the exchange after adjusting its past earnings following Ghosn's arrest in November 2018.

The arrest of Nissan's former chief executive officer and chairman in November 2018 for financial crimes triggered turmoil within the automaker's management ranks and destabilised its relationship with alliance partner Renault.

Ghosn fled trial in Japan at the end of December and is now in Lebanon. While the timing of the report has little to do with his recent escape, it underscores the extent to which Nissan has had to reform its practices in the year after his arrest. Many of the steps outlined in the report, such as abolishing a CEO reserve fund and a restatement of Ghosn's income, have already been disclosed or reported.

"A wide variety of misconduct had been committed over a long period of time," the report said, noting that many people were involved and that the infractions were committed not only in Japan but also in foreign countries.

Nissan will decide the punishment for the others in due course, it said.

The misconduct outlined in the report was not limited to acts allegedly committed by Ghosn and executive Greg Kelly, but also included excess salary paid to Ghosn's successor, Hiroto Saikawa, who was ousted as CEO in September.

The report found that six others also received excess compensation via stock appreciation rights, but did not identify them. The amount involved totalled of 57.7 million yen (S$706,545), though Nissan expects most of that to be repaid by March.

The investigation involved more than 10,000 hours of analysis, Nissan said, including the collection of nine million documents and interviews with more than 70 people within the company.

Among the steps the carmaker will take to improve its corporate governance is the abolishing of a system of having former directors become advisers and consultants.

This means Mr Saikawa, who was reportedly planning to stay on at Nissan in some capacity after leaving the board at a shareholders' meeting planned for Feb 18, will now probably leave the company entirely. By abolishing the adviser role, Nissan's new CEO, Makoto Uchida, may be able to act more independently.

Meanwhile, the legal "Dream Team" of lawyers hired to defend Ghosn have all pulled out of involvement in the case.

The Japanese lawyer nicknamed "The Razor", who was spearheading Ghosn's defence, said on Thursday he is quitting the case after his client skipped bail and left Japan.

Junichiro Hironaka's office issued a brief statement saying that they had "filed with the Tokyo District Court letters of resignation for all lawyers... connected with all cases related to Mr Carlos Ghosn".

Mr Hironaka, 74, who earned his nickname for sharp legal strategies and an enviable acquittal record, has said he was "dumbfounded" by Ghosn's escape, which he found out through news reports on the morning his client fled.

Another one of Ghosn's legal team, Takashi Takano, has also thrown in the towel on the case, a source close to his office told AFP.

Hiroshi Kawatsu, the third man in the legal team assembled by the former Nissan boss, has not publicly commented on his plans and could not be immediately reached for comment. BLOOMBERG, AFP