From hero to zero
Before the fall. Carlos Ghosn (Photo: Reuters)

Carlos Ghosn, the "miracle worker" who saved both Groupe Renault and Nissan Motor Co, Ltd from bankruptcy, told the Tokyo District Court today that he is innocent of charges of financial misconduct that sent him to jail in November 2017, and destroyed his once-sterling reputation in the auto industry.

Prosecutors claim Ghosn conspired with his right-hand man, American executive Greg Kelly, to hide around half of his income (some $44 million) over five fiscal years starting 2010. They also allege he under-reported his salary to the tune of $36.8 million over the next three fiscal years, apparently to avoid criticism that his pay was too high.

Prosecutors have pressed formal charges over the first allegation that Ghosn under-reported his salary from 2010-2015. They have not pressed charges over the other accusations.

Ghosn was re-arrested, but not indicted, on Dec. 21 on allegations he transferred personal investment losses worth $17 million to Nissan. He has been held for over 50 days at Tokyo's Kosuge detention center.

"I have been wrongly accused and unfairly detained based on meritless and unsubstantiated accusations," said Ghosn. "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."

Ghosn's appearance was requested by his lawyers to explain the reasons for Ghosn's prolonged detention, which seems illegal by Western standards. In Japan, however, suspects can be detained without charge for up to 23 days and then re-arrested on separate charges.

Ghosn was arrested on Nov. 19 and charged with underreporting his income. He was re-arrested twice on different charges since a tactic often used by Japanese prosecutors to keep suspects in jail. Looking gaunt, Ghosn appeared in court handcuffed and with a rope tied around his waist.

Before his arrest and fall from the heights, Ghosn was chairman and CEO of the Renault-Nissan-Mitsubishi Alliance, a strategic partnership between those automotive manufacturers. On Nov. 22, Nissan's board made the unanimous decision to dismiss Ghosn as its chairman. Mitsubishi Motors' board followed suit on Nov. 26.  Ghosn, however, remains Chairman and CEO of Renault.