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Former Nissan chairman Carlos Ghosn declared he was innocent in his first public appearance since his arrest in November, telling a Tokyo court that he was wrongly accused of financial misconduct.
Key points:
- Carlos Ghosn rescued Nissan from near-bankruptcy two decades ago
- He allegedly under-reported his income and covered investment losses with Nissan funds
- His detention has fuelled international scrutiny into Japan's criminal justice system
"I have been wrongly accused and unfairly detained based on meritless and unsubstantiated accusations," he told the Tokyo District Court, according to a prepared statement which was obtained by Reuters.
"Contrary to the accusations made by the prosecutors, I never received any compensation from Nissan that was not disclosed, nor did I ever enter into any binding contract with Nissan to be paid a fixed amount that was not disclosed."
Mr Ghosn is credited with rescuing Nissan from near-bankruptcy two decades ago.
A crowd of journalists and television crew gathered outside the court house while earlier, 1,122 people lined up for 14 court seats assigned by lottery, highlighting the level of public interest in the case of the once-feted executive.
The hearing, requested by his lawyers, was held to explain the reasons for his prolonged detention since his November 19 arrest.
Presiding Judge Yuichi Tada read out the charges and said Mr Ghosn was being detained due to flight risk and the possibility that he may conceal evidence.
Investment losses and Saudi payments
Mr Ghosn has been formally charged with under-reporting his income.
The 64-year-old executive has also been arrested, but not yet indicted, on allegations of aggravated breach of trust in shifting personal investment losses worth $24 million to the carmaker.
Regarding allegations that he transferred losses to Nissan, Mr Ghosn said he had asked the company to temporarily take on collateral for his foreign exchange contracts.
He said he did this to avoid the only other choice he had, which was to resign and use his retirement allowance for collateral.
"But my moral commitment to Nissan would not allow me to step down during that crucial time," he said.
"A captain doesn't jump ship in the middle of a storm."
Mr Ghosn also said the contracts were transferred back to him, and that Nissan had not incurred any loss.
Mr Ghosn is also accused of making $20.6 million in payments to Saudi businessman Khaled Al-Juffali using Nissan funds in exchange for arranging a letter of credit to help with his investment losses.
Mr Ghosn said in his prepared remarks that Mr Juffali's company was compensated for "critical services that substantially benefited Nissan", including soliciting financing and solving problems involving a local distributor.
The Khaled Juffali Company also issued a statement saying it had received the payments for legitimate business purposes.
The case has rattled Nissan's alliance with French automaker Renault, where Mr Ghosn still remains chairman and chief executive.
He had been pushing for a deeper tie-up between the pair, including potentially a full merger at the French government's urging, despite strong reservations at Nissan.
Japan's criminal justice system under scrutiny
His arrest has also put Japan's criminal justice system under international scrutiny and sparked criticism for some of its practices, including keeping suspects in detention for long periods and prohibiting defence lawyers from being present during interrogations that can last eight hours a day.
Mr Ghosn, who was arrested first on November 19, has been re-arrested twice on different charges since then, a tactic often used by Japanese prosecutors to keep suspects in detention.
He has been held at the Tokyo Detention Centre, a spartan facility where small rooms have a toilet in the corner and no heater — a far cry from the jet-setting lifestyle Ghosn was accustomed to.
His son, Anthony Ghosn, said his father had lost 10 kilograms during his detention, according to France's weekly Journal du Dimanche.
Under Japanese law, suspects can be detained without charges for up to 23 days, and then re-arrested on separate allegations.
On December 31, the Tokyo District Court granted prosecutors' request to extend Mr Ghosn's detention by 10 days until January 11.
Nissan, which has ousted Mr Ghosn from its board, has said a whistleblower investigation also uncovered personal use of company funds and other misconduct.
Reuters
Topics: fraud-and-corporate-crime, law-crime-and-justice, corruption, automotive, japan, asia
First posted