Ghosn ‘pays Nis­san se­cret funds to Mid­dle East’

The Phnom Penh Post - - BUSINESS -

FOR­MER Nis­san Mo­tor Co Chair­man Car­los Ghosn had about $100 mil­lion paid from the au­tomaker’s con­fi­den­tial funds to agents and other en­ti­ties in five Mid­dle East­ern na­tions be­tween 2009 and 2017, the Yomi­uri Shim­bun has learned.

The spe­cial in­ves­ti­ga­tion squad of the Tokyo Dis­trict Pub­lic Pros­e­cu­tors Of­fice is ex­am­in­ing this flow of money and has re­quested as­sis­tance from in­ves­tiga­tive au­thor­i­ties in those na­tions. This mon- ey in­cludes a to­tal of $14.7 mil­lion sent from Nis­san funds to Ghosn’s ac­quain­tance in Saudi Ara­bia.

Ac­cord­ing to sources, the money came from con­fi­den­tial funds called “CEO re­serves”. Ghosn ap­par­ently or­dered his sub­or­di­nates to es­tab­lish the fund in around De­cem­ber 2008, when he was Nis­san’s CEO. Money from this fund could be dis­bursed at Ghosn’s dis­cre­tion.

Ghosn had Nis­san Mid­dle East FZE, a Nis­san con­sol­i­dated sub­sidiary based in the UAE, make pay­ments from the con­fi­den­tial funds to en­ti­ties in the five Mid­dle East­ern na­tions. Of the about $100 mil­lion, $14.7 mil­lion went to Saudi Ara­bia, $35 mil­lion went to Oman, $20.4 mil­lion to Le­banon, $25.6 mil­lion to the UAE and $2.5 mil­lion to Qatar. This money was sent to Ghosn’s Saudi ac­quain­tance start­ing from 2009 and to the four other na­tions from 2011, ac­cord­ing to the sources.

The money, which was sent to agents in­volved in sell­ing Nis­san ve­hi­cles and other en­ti­ties in those coun­tries, was nom­i­nally for “sales in­cen­tives” among other pur­poses.

A Nis­san Mid­dle East of­fi­cial told the Yomi­uri Shim­bun: “It was Nis­san Mid­dle East’s de­ci­sion to make the pay­ments for nec­es­sary ex­penses in ac­cor­dance with their sales per­for­mance, but sep­a­rately there were in­struc­tions from Ghosn to ‘pay the money’. The ob­jec­tive of pro­vid­ing the money was un­clear.”

The money re­mit­ted to Oman and Le­banon was paid to com­pa­nies that sep­a­rate ac­quain­tances of Ghosn were in­volved in manag­ing. The spe­cial in­ves­ti­ga­tion squad is ex­am­in­ing the pos­si­bil­ity that these ex­pen­di­tures had no con­nec­tion to Nis­san’s busi­ness op­er­a­tions.

In Oc­to­ber 2008, Ghosn shifted ap­praisal losses worth about 1.85 bil­lion yen (about $17.043 mil­lion at the cur­rent ex­change rate) aris­ing from a pri­vate in­vest­ment to Nis­san. From June 2009 to March 2012, he had a to­tal of about 1.6 bil­lion yen sent to the Saudi ac­quain­tance who had pro­vided about three bil­lion yen as “guar­an­tee fees” and other pur­poses to help se­cure a credit guar­an­tee for Ghosn’s in­vest­ment. Ghosn has been re­ar­rested on sus­pi­cion of ag­gra­vated breach of trust un­der the Com­pa­nies Law.

The spe­cial in­ves­ti­ga­tion squad be­lieves Ghosn fun­nelled the Nis­san funds to his ac­quain­tance to re­im­burse him for the guar­an­tee fees and as a to­ken of grat­i­tude.

Ghosn, 64, de­nied these al­le­ga­tions when he at­tended a hear­ing on Tues­day at the Tokyo Dis­trict Court to dis­close the grounds for his de­ten­tion. Ghosn said the ac­quain­tance was ap­pro­pri­ately com­pen­sated – an amount ap­proved by the rel­e­vant of­fi­cers at Nis­san – in ex­change for crit­i­cal ser­vices that ben­e­fited Nis­san.

Ac­cord­ing to Ghosn’s lawyer, Ghosn ex­plained the pay­ments made to the en­ti­ties in the Mid­dle East­ern na­tions were proper be­cause the money was paid as in­cen­tives in line with their sales per­for­mance.

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