Ghosn, Nissan Fined $16 Million by SEC
On Monday, the Securities and Exchange Commission announced that Nissan and its former chairman, Carlos Ghosn, are on the hook for $16 million in fines. The SEC alleges that the automaker failed to disclose millions of dollars in compensation that the former Renault-Nissan-Mitsubishi Alliance chairman was due to receive via a 2004 board decision that allowed him to decide the compensation of high-ranking executives — including himself.
Reports from Bloomberg stipulate that Ghosn and subordinates managed to withhold over $90 million in compensation from shareholders since 2009, with the ousted CEO attempting to put another $50 million away for his retirement allowance.
While the cash has caused problems for other executives, including Nissan CEO Hiroto Saikawa, the brunt of the media attention remains on Ghosn. Earlier this month, Saikawa fast-tracked his retirement, saying he would repay whatever money he accumulated through questionable bonuses. Meanwhile, Carlos is still awaiting trial on finance-related charges in Japan. He has continued to profess his innocence since his initial arrest last November.
From Bloomberg:
The SEC also reached a settlement with former Nissan director Greg Kelly, who agreed to pay a $100,000 fine over allegations that he helped Ghosn hide pay. Ghosn was barred from serving as a director or officer of a public company for 10 years, while Kelly agreed to a five-year ban. Nissan, Ghosn and Kelly, 63, all resolved the cases without admitting or denying wrongdoing.
Nissan said in a statement that it cooperated fully with the SEC and has “‘promptly implemented remedial acts to prevent recurrence.”
Lawyers for Ghosn and Kelly said the decision to settle with the SEC should have no bearing on separate Japanese cases against their clients.
“Greg is a guy with limited resources” said James Wareham, Kelly’s Washington-based attorney. He said his client settled so that he can better concentrate on the charges he faces in Japan.
Ghosn’s defense team is similarly focused. “We are pleased to have resolved this matter in the U.S. with no findings or admission of wrongdoing,” they said in a statement, adding that their client is still preparing for his court date in Japan.
[Image: FotograFFF/Shutterstock]
A staunch consumer advocate tracking industry trends and regulation. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied with the corporate world and resentful of having to wear suits everyday, he pivoted to writing about cars. Since then, that man has become an ardent supporter of the right-to-repair movement, been interviewed on the auto industry by national radio broadcasts, driven more rental cars than anyone ever should, participated in amateur rallying events, and received the requisite minimum training as sanctioned by the SCCA. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and managed to get a pizza delivery job before he was legally eligible. He later found himself driving box trucks through Manhattan, guaranteeing future sympathy for actual truckers. He continues to conduct research pertaining to the automotive sector as an independent contractor and has since moved back to his native Michigan, closer to where the cars are born. A contrarian, Matt claims to prefer understeer — stating that front and all-wheel drive vehicles cater best to his driving style.
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This seems tautological. If ghosn is fined for potential to earn after being CEO, does that mean he will be paid for being in prison? If he is not paid while being in prison, how can he be fined for misrepresenting earnings he has not earnt, and is unlikely to earn? SEC (both USA and Japan) have some bizarre ideas.
Again the logic is breathtaking. Ghosn won't get paid because of the fine, but the fine is for misrepresenting income, which will not be income anyway. Its like comedy plot for a movie.