Nissan to oust iconic chairman Ghosn after shock arrest

November 19, 2018 21:23

Nissan Motor Co will remove Carlos Ghosn as chairman after he was arrested in Tokyo for violations of financial law, throwing the auto industrys largest global alliance into turmoil.

Ghosn, a towering figure who saved Nissan from collapse and brought it together with Renault SA and Mitsubishi Motors Corp, was detained on Monday in Tokyo over the suspected breach of Japanese financial laws, Nissan Chief Executive Officer Hiroto Saikawa told reporters in Yokohama, Japan. Ghosn and Director Greg Kelly have been under investigation at Nissan for several months, and the board is set to meet Thursday to remove them both.

Both Ghosn and Kelly were reporting compensation to securities regulators in Tokyo that was less than the actual amount, Nissan said, adding that they did this to reduce Ghosns disclosed compensation. Regarding Ghosn, numerous other significant acts of misconduct have been uncovered -- such as personal use of company assets -- and Kellys deep involvement has also been confirmed, the carmaker said in a statement.

Saikawa said the company cant disclose further details of the suspected wrongdoing. Too much power being concentrated to one individual allowed for the misconduct, and Nissan failed to detect it because its structure wasnt transparent enough, he said. Ghosn is suspected of understating his income by 5 billion yen ($44 million) over five years, Kyodo reported.

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