Mitsubishi Motors CEO Osamu Masuko speaks during a news conference in Tokyo, Japan, on January 18 2019. Picture: KIYOSHI OTA/BLOOMBERG
Mitsubishi Motors CEO Osamu Masuko speaks during a news conference in Tokyo, Japan, on January 18 2019. Picture: KIYOSHI OTA/BLOOMBERG

Tokyo — Carlos Ghosn improperly received $9m in compensation from a joint venture (JV) between Nissan and Mitsubishi Motors, the Japanese vehicle makers said on Friday, raising the possibility of their ousted chair facing a new charge of embezzlement.

In the latest twist to the saga of the once-feted official's fall from grace, the vehicle makers have found that Ghosn was paid by their Netherlands-based JV without the knowledge of the unit's two other directors — Nissan Motor CEO Hiroto Saikawa and Mitsubishi Motor CEO Osamu Masuko.

Ghosn, arrested and detained in Tokyo for about two months, has already been indicted on charges of under-reporting his income for eight years at Nissan to the end of March 2018, and temporarily transferring personal investment losses to the vehicle maker during the global financial crisis.

"That such misconduct also occurred at our affiliate is beyond shocking ... it's sad," Masuko told reporters, referring to the payments made to Ghosn from Nissan-Mitsubishi, registered in the Netherlands in 2017.

Both Mitsubishi and Nissan said they would consider ways to recover the amount from Ghosn, while Mitsubishi lawyer Kei Umebayashi said a criminal charge was also possible.

"The most likely charge for this would be embezzlement," he told reporters at a briefing.

Compensation from joint venture

According to Mitsubishi's legal team, over April-November 2018, Ghosn received around €5.8m in annual pay for his role as managing director, a €1.4m signing fee and an undisclosed incentive from the JV.

Reuters reported earlier this week about the alleged improper compensation to Ghosn by the JV and that Nissan was considering filing for damages, citing a source.

The unit had been intended to fund expenses for the partnership including consultant fees, joint promotional activities, workspace use and corporate jets, Masuko said.

"From the time that the unit was established to when I was told about the payments, I had absolutely no idea that the unit was being used for such payments," Masuko added.

Ghosn's lawyer, Motonari Otsuru, could not be immediately reached by telephone for a comment on Friday. Ghosn has denied all previous charges against him.

Muddy waters

The arrest of Ghosn, who spearheaded Nissan's turnaround two decades ago, and the list of charges against him have jolted the auto industry, while muddying the outlook for Nissan's three-way alliance with Mitsubishi and France's Renault SA.

Renault has come under a lot of pressure in recent days from its biggest shareholder, the French government, to replace Ghosn as its CEO and chair. The vehicle maker has kept him at its helm, even as Nissan and Mitsubishi moved swiftly to oust him as chair after his arrest.

The French car maker, however, confirmed on Thursday that it was considering new leadership, after finance minister Bruno Le Maire called publicly for a board meeting to address his succession.

Ghosn's pay has been a hotly debated issue at Renault's shareholder meetings where he lost a vote on pay a few years ago. He has also been in the news previously for hidden bonus plans.

Reuters reported in 2017 on a plan by Renault-Nissan bankers to pay millions in undisclosed bonuses via a specially created Dutch service company to Ghosn and other managers. The plan was scrapped after the report.

Renault owns about 43% of Nissan, the biggest firm in the alliance by sales and which in turn has a nonvoting 15% stake in Renault. Mitsubishi became the smallest member when Nissan took a 34% stake in it in 2016. 

Reuters