By on January 8, 2020

Carlos Ghosn

There’s no love lost between former Renault and Nissan boss Carlos Ghosn and the judiciary of Japan, and the same goes for the automaker that dropped him as chairman following his November 2018 arrest — an arrest he fled in the waning days of 2019.

A fugitive from justice following his daring escape from Japanese authorities, Ghosn opened up during a Wednesday press conference in Beirut, Lebanon, reserving his harshest remarks for Nissan and the country in which its head office resides.

“I was brutally taken from my world as I knew it,” said a fiery Ghosn, his hair looking far greyer than in the months leading to his arrest. “I felt I was a hostage of a country that I had served for 17 years.”

Captivity in a Tokyo jail was torture, Ghosn claims, and his decision to flee house arrest and looming trials for financial wrongdoing was “the most difficult decision of my life.” Ghosn, the subject of an Interpol arrest warrant, stands charged with underreporting income to Japanese regulators and offloading personal losses to Nissan. As before, the fallen auto titan vigorously denies the allegations.

“I have not experienced a moment of freedom since Nov. 19, 2018,” Ghosn told assembled media. “It is impossible to express the depth of the aggravation and my profound appreciation once again to be able to be reunited with my family and loved ones.”

Carlos Ghosn - Titan intro - Image: Nissan

The former executive claims interrogations lasted up to eight hours, day and night, with Japanese authorities apparently showing little interest in finding out the truth. Not surprisingly, Ghosn said he felt pressured to confess. Having not done so, and realizing the country’s sky-high conviction rate, the man who once rescued Renault and Nissan said he felt he would die in Japan if he didn’t make a break for it.

“It will be over if you just confess,” he said, describing his encounters with Japanese officials. “If you don’t confess, not only are we going to go after you, we are going to go after your family.”

Claiming he never should have been arrested in the first place, Ghosn reiterated earlier claims that his arrest was orchestrated with the help of Nissan. The plot arose, he said, after he began positioning alliance partners Renault and Nissan for closer tie-up.

“Some of my Japanese friends thought that the only way to get rid of the influence of Renault on Nissan, was to get rid of me,” he said. Ghosn said he regrets not retiring when he had a chance.

At the time of his arrest, Ghosn claims he was in the midst of orchestrating a merger with Fiat Chrysler Automobiles; the Italian-American auto giant later announced a merger with PSA Group, Renault’s main French rival.

Ahead of the media conference, Ghosn’s lawyers issued a statement calling out the Nissan internal investigation that led to the charges against their client.

“The investigation was initiated and carried out for the specific, predetermined purpose of taking down Carlos Ghosn to prevent him from further integrating Nissan and Renault, which threatened the independence of Nissan,” his lawyers wrote. They added that the probe somehow skipped over officials with their own compensation controversies, including former CEO Hiroto Saikawa.

In the background of Ghosn’s presser, Japanese authorities raided the offices of his Japanese lawyers, who claim they were able to save two computers from confiscation. Japan has also issued an arrest warrant for Ghosn’s wife, Carole, claiming she had lied during testimony.

Japanese media report that Ghosn’s December 29th flight from house arrest began at the front door of his Tokyo home, from which the former exec emerged wearing a hat and face mask. From there, he travelled by bullet train to Osaka, some 300 miles distant. Somewhere along the way, he allegedly met up with two operatives, one a former U.S. special forces member, who aided in his escape and accompanied him on a private plane bound for Istanbul, Turkey. Ghosn was reportedly smuggled onto the plane in an oversized case designed for musical instruments.

A second aircraft carried Ghosn to his childhood home of Lebanon, where the fugitive would be safe from extradition.

 

[Sources: The New York Times, CNBC] [Images: Nissan]

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18 Comments on “Carlos Ghosn Comes Out Firing in Beirut Press Conference...”


  • avatar
    Detroit-X

    I have been watching the video this morning. I am on the side of Ghosn. There are two sides to every story.

  • avatar
    JimC2

    I’m leaning that way too. What the Japanese legal system does and how it runs isn’t my say, but circumstantially they’re not looking too good right now.

  • avatar
    SCE to AUX

    I’m siding with Ghosn, too. Even if he is guilty, the treatment he has received so far doesn’t match the alleged crime.

    But the details of his epic escape keep changing, so the entertainment value continues.

    • 0 avatar
      FreedMike

      By American standards, his treatment doesn’t fit the crime. Unfortunately, Japan has different standards. We can condemn it all day long, but that’s how it works. Doesn’t make it right, but it is what it is, I suppose.

  • avatar
    jmo

    What sort of treatment should someone get when they steal tens of millions of dollars?

  • avatar
    Detroit-X

    Watch his video and then form your opinion.

  • avatar
    s_a_p

    So his defense is (they cant handle/dont want to know the truth), and that other people have done it too?

    It all seems to be pretty high drama to me. Is that really the best way to prevent Nissan from further entangling itself with PSA? It seems unlikely to me that exposing financial impropriety is prudent in any situation. I would be curious to know why the leadership team at Nissan didnt just say they arent happy and would like to divest.

    I cant say I would want to get arrested anywhere, but being a foreigner in any land puts you at a huge disadvantage in any justice system. I cant say I blame him for bailing if he has the means.

  • avatar
    jmo

    ” that other people have done it too?”

    Then it would be like me getting pulled over for doing 80 in a 65 and fighting the ticket on the grounds that I was just going with the flow of traffic. FYI that defense doesn’t work.

  • avatar
    FreedMike

    Leaving aside how Ghosn was treated by the Japanese legal system, how that system works, and the “it was boardroom hit job” arguments (which all may be on target), I’m pretty convinced he did exactly what he was accused of doing.

    And as far as the “boardroom hit job” is concerned, consider this: Nissan’s pathetic current state is 100% a product of its’ lousy product lineup and its’ marketing strategies, and that’s *ALL* on Ghosn. Looks to me like under him the company had a good, long run, right before he ran it right into the ground.

    Did that mean he had this treatment coming? No. But it does partially explain it. Combine Nissan’s failure with the de facto embezzlement charges, and that’s all the board needed.

  • avatar
    s_a_p

    That makes sense- and trust me, I’m no fan of Ghosn’s and don’t think he did right by Nissan. I find his defense a bit flimsy really. All of the folks thinking that they should run a car company like any other business selling widgets doesnt get it. In the car biz, if you extract profit in the short term with cost cutting you guarantee less long term profit once your race to the bottom ends.

  • avatar
    multicam

    Can’t wait to see the major motion picture

  • avatar
    WildcatMatt

    I’m divided on this.

    I think he’s probably guilty of breaking some laws and certainly of bending others. I’m sure many other CEOs have done similar things without being caught. I also think that he’s probably correct that some faction of the business wanted rid of him and ratted him out. And I’m willing to believe that the legal system was messing with him in the hopes of extracting a confession.

    All that being said…

    It’s also clear that Ghosn was under the impression that if he were caught that he would be in an “Office Space” style situation in a “white collar jail with conjugal visits” and not “federal pound-me-in-the-a$$ prison” (yes, I know he was in solitary). There’s also the implication that he’s surprised that the legal system would mess with him to extract a confession. Both positions are either profoundly insincere or profoundly naive.

    • 0 avatar
      28-Cars-Later

      Based on some previous articles, this “undereporting” seems to be something like an SEC violation, *not* tax evasion, *not* embezzlement, and none of the articles I’ve found say explicitly he had the money in his possession:

      “Nissan claims Ghosn and Kelly arranged, over the course of the current decade, to have nearly $80 million paid out after Ghosn’s retirement, but any deferred income still needs to be reported to securities regulators.”

      https://www.thetruthaboutcars.com/2018/12/ghosn-nissan-indicted-by-japanese-authorities/

      The phrase “after Ghosn’s retirement” sounds like a golden parachute/parting gift to the chairman. So from what I can tell they are p!ssed because this wasn’t in the annual report which in addition to violating one of their diktats means investors who read these reports and use them as part of their strategy were not informed Renault-Nissan was going to pay out $80 million or some such after his retirement.

      This however sounds a bit less innocent:

      “Carlos Ghosn, the former chairman of Nissan Motor Co, shifted personal investment losses incurred during the 2008 financial crisis to the automaker to avoid millions of dollars in losses himself, the Asahi Shimbun reported on Tuesday.

      Citing multiple unnamed sources, the paper said that when Ghosn’s bank had called for more collateral from the executive, he instead handed the rights over the derivatives trade to Nissan, which effectively shouldered 1.7 billion yen ($15 million) in losses”

      So he lost $15 million and gave the bad derivative “rights” to Nissan. Did Nissan reimburse him 100% for the derivative, de facto embezzlement, or is this some kind of accounting trick?

      However the more important question here is this evidently happened in 2008/2009, why hasn’t this come up before?

      “Japan’s Securities and Exchange Surveillance Commission (SESC) discovered this incident during that year’s routine inspection, the Asahi said.”

      Which year? 2008/2009? So the Japanese SEC sat on this for ten years and did nothing? *Really*?

      https://www.reuters.com/article/nissan-ghosn/ghosn-suspected-of-shifting-personal-investment-losses-to-nissan-asahi-idUSL4N1Y2035

      Then above:

      “They added that the probe somehow skipped over officials with their own compensation controversies, including former CEO Hiroto Saikawa.”

      So between the apparent “we sat on a violation for ten years” and “we allegedly skipped probing other high level executives” does Japanese gov’t follow its own laws?

      —————————-

      Michael Corleone: My father is no different than any powerful man, any man with power, like a president or senator.

      Kay Adams: Do you know how naive you sound, Michael? Presidents and senators don’t have men killed.

      Michael Corleone: Oh. Who’s being naive, Kay?

      • 0 avatar
        dal20402

        Read the SEC press release. It’s far more concise. Regulators are better at describing white-collar misconduct than journalists.

        The Nissan board gave him power to set his own compensation (a horrible move by any board). He did so, but he lied to the board about the level where he had set it. Then he also lied to both American and Japanese regulators about it, presumably to cover up the original lie. That’s embezzlement, and it’s before we get into the weird securities trades and the company’s payment of all sorts of expenses that obviously had nothing to do with compensation.

        • 0 avatar
          28-Cars-Later

          So he did take possession of the $80 million (or some such amount)?

          • 0 avatar
            dal20402

            What matters isn’t whether he took possession but whether he had a contractual right to do so. I expect he did, or else the SEC wouldn’t have had much leverage.

          • 0 avatar
            28-Cars-Later

            So telling lies about having the contractual right to pay yourself X after an event/goal (i.e. retirement) is embezzlement? I realize this is roughly your area of expertise but to we proles it sounds a little like splitting hairs, especially without the act or attempted act at taking possession of the money.

  • avatar
    dal20402

    There is no question that the Japanese process is different and harsher than what he would have undergone in the US. The question in my mind is whether it was normal under local law, or whether it was worse than normal either (1) because he was a gaijin or (2) because the authorities were in cahoots with Nissan. There ought to be an investigation about that, although I’m sure there won’t be.

    But it rankles that he’s not going to face justice anywhere for his theft.

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