世界の三番目、大金持ちの経済大国のニッポン。 World’s No.3, extremely rich, economic super-power Nippon.
World’s No.3, extremely rich, economic super-power Nippon.
GDP 5 trillion US$, No.3 in the world.
GDP per capita around 40.000 US$.
You are suddenly arrested. No trial. Everybody is “naked”, “equal”. 3 Tatamis are enough.
Pay no attention to “house arrest”.
今日、平成30年11月25日。Today is the 25th November 2018.
Ghosn’s aide denies underreporting chairman’s salary: source
KYODO NEWS – 4 hours ago – 22:03 (2018/11/24 Japan time)
Nissan Motor Co.’s representative director, who was arrested with Chairman Carlos Ghosn for allegedly conspiring in financial misconduct, has denied that Ghosn’s salary was underreported in the company’s securities reports, sources close to the matter said Saturday.
Greg Kelly said Nissan’s securities reports were properly written and there were no problems with them, the sources said. It is the first time comments made by either of the two Nissan officials on the allegations have become known since their arrest on Monday. Both Ghosn, 64, and Kelly, 62, were stripped of their posts at an emergency board meeting Thursday.
Kelly rebutted that there was an intention to falsely represent Ghosn’s salary in the securities reports, saying he wrote the reports after consulting with company officials and not on Ghosn’s orders, according to the sources.
Tokyo prosecutors arrested Ghosn for allegedly underreporting his salary by around 5 billion yen ($44 million) for five years through fiscal 2014 while receiving nearly 10 billion yen during the period.
The arrest came after a small group, involving board members, clandestinely conducted an internal investigation starting this spring, according to other sources familiar with the matter.
The in-house investigation was triggered by a whistleblower report. Until then, although there had been some suspicion in the company of Ghosn misappropriating Nissan funds, he was so powerful that people were afraid to criticize him, according to the sources.
Ghosn is also suspected of having tried to cover up a total of 8 billion yen in remuneration by underreporting his salary for eight years, according to other sources familiar with the matter.
He allegedly determined the remuneration as about 2 billion yen per year and underreported it by half, the sources said.
Ghosn is believed to have made his remuneration look smaller to avoid criticism from Nissan shareholders, they said.
The underreporting that allegedly continued in the three years since fiscal 2015 would bring the total amount of money covered up to around 8 billion yen, they said.
Meanwhile, Nissan’s corporate auditors suspect the company bought residences for Ghosn through an Amsterdam-based overseas investment subsidiary named Zi-A Capital BV, the sources said.
Nissan put some 6 billion yen into the company when it was set up in 2010.
Ghosn became a board member of Zi-A Capital when it was established but resigned the following year. Kelly and some former Nissan executives have been on the list of its board members.
Ghosn aide says he did nothing wrong in filing income reports
THE ASAHI SHIMBUN
November 24, 2018 at 18:25 JST
A former Nissan Motor Co. executive arrested along with Carlos Ghosn says he appropriately handled all matters concerning remuneration, effectively denying allegations of financial misconduct, sources said.
Greg Kelly, 62, held the position of representative director at the automaker and was considered as one of the closest aides to Ghosn, who was chairman.
The Special Investigation Department of the Tokyo District Public Prosecutors Office arrested Ghosn, 64, and Kelly on Nov. 19 on suspicion they conspired to under-report Ghosn’s remuneration for a five-year period from fiscal 2010 to 2014 by about 5 billion yen ($44.3 million).
The company’s securities reports showed that Ghosn’s total amount of remuneration for the period was about 4.987 billion yen. But the actual amount allegedly stood at 9.998 billion yen.
Nissan stripped Kelly of his post of representative director at an extraordinary board meeting on Nov. 22.
日産 ケリー前代表取締役「前会長の報酬 適切に処理」
2018年11月24日 14時50分ゴーン会長 影響
Ex-Nissan Chairman Ghosn denies understating salary
November 25, 2018 (Mainichi Japan)
TOKYO (Kyodo) — Carlos Ghosn, who was recently ousted as Nissan Motor Co. chairman after being arrested for the alleged understatement of his remuneration in securities reports, has denied the charge, sources close to the matter said Sunday.
No comments from Ghosn have been made public since his arrest on Monday by Tokyo prosecutors on suspicion of underreporting his pay package by around 5 billion yen ($44 million) for five years through fiscal 2014. He received nearly 10 billion yen during that period.
Greg Kelly, former Nissan representative director who was arrested for allegedly conspiring to understate Ghosn’s remuneration, has also denied the allegation, according to the sources.
Prosecutors question Nissan president over Ghosn’s alleged salary underreporting
November 22, 2018 (Mainichi Japan)
TOKYO — Prosecutors here questioned Nissan Motor Co. President Hiroto Saikawa and director Toshiyuki Shiga on a voluntary basis concerning the arrest of company chairman Carlos Ghosn over the underreporting of his salaries in financial statements, according to people familiar with the matter.
The special investigation unit of the Tokyo District Public Prosecutors Office is considering slapping criminal charges against the major carmaker over the Ghosn case because the income the elite businessman allegedly avoided reporting to authorities stands at some 5 billion yen. Prosecutors believe that Nissan as a corporation should also face criminal responsibility over the scandal.
Prosecutors apparently questioned Saikawa and Shiga about the background of the underreporting case, as well as their awareness of the chairman’s suspected wrongdoings.
Ghosn and Nissan representative director Greg Kelly, 62, were arrested on suspicion of submitting falsified financial statements to the Kanto Local Finance Bureau for the five-year period between fiscal 2011 and 2015. While the actual amount Ghosn received totaled some 9.998 billion yen, the figure listed in the statements was only about 4.987 billion yen. The Tokyo District Court on Nov. 21 approved the detention of Ghosn and Kelly for 10 days until Nov. 30.
Kelly, Ghosn’s close aide, allegedly instructed executive officers and others under him to falsify the reports. Shiga was chief operating officer and deputy chairman during the period Ghosn allegedly underreported the funds he received.
The average annual remuneration Ghosn allegedly hid from the authorities was about 1 billion yen, which a senior prosecution official described as “extremely substantial.” Corporate board members are legally required to submit their names and salaries in their companies’ financial statements when their annual salaries are 100 million yen or more.
The Financial Instruments and Exchange Act, which Ghosn and Kelly are suspected of violating, provides for up to 10 years in prison or a fine of up to 10 million yen for false reporting. The corporations to which those offenders belong are also subjected to a fine of up to 700 million yen.
In the past, criminal cases based on the act mostly concerned corporate window-dressing scandals. In those cases, false financial statements were often prepared to hide corporate debts by listing nonexistent profits. It is extremely rare for law enforcement authorities to apply the law to a case where board member pay was underreported.
The Observer Corporate governance
Nissan crisis sheds new light on Japan Inc’s awkward secrets
The fall of Carlos Ghosn is the just latest in a series of shocks involving some of the country’s biggest companies
The Guardian, Justin McCurry
Sat 24 Nov 2018 16.00 GMT
Even as Carlos Ghosn sits alone in a tiny cell, with just 30 minutes of daily exercise to break the monotony of detention, Japan has found it hard to muster a shred of sympathy for a man hailed as a colossus of the global car industry until his rapid downfall just five days ago.
But however badly the affair reflects on the former chairman of Nissan as a business leader, his arrest last week over allegations of “significant financial misconduct” raises equally serious questions about the health of Japan’s corporate culture.
Critics have attributed the scandal to the executive’s imperious personality and the lure of personal enrichment, after prosecutors arrested Ghosn on allegations of understating his income in financial statements by ¥5bn (£35m) over a five-year period.
But that is only part of the story, according to Sarah Parsons, managing director of Japan In Perspective, a business consultancy supporting Japanese firms in the UK. “While corporate governance scandals are not unique to Japan, there are certainly unique cultural factors that mean bad business behaviour is allowed to fester in Japan,” she says.
Parsons blames poor corporate oversight and the dominance on Japanese boards of company “insiders” – almost always middle-aged men who have formed impenetrable networks during careers spent working for the same company. Instead of exercising vigilance against potential wrongdoing, employees – even those at senior level – are expected to maintain harmony and avoid gaining a reputation as a troublemaker.
“Given the strict hierarchies in Japanese society, expecting individuals to blow the whistle on their peers – or, even worse, their seniors – is a cultural no-no,” Parsons says. “The consensus-driven and long-winded nature of Japanese decision making has in some cases led to a lack of willingness to be accountable and a tendency to avoid the consequences until forced.”
Michael Woodford understands that better than most. Seven years ago he was lauded by some as a champion of corporate transparency when, soon after becoming the first foreign chief executive of Olympus, he exposed systematic accounting fraud at the Japanese medical imaging company. His colleagues, however, viewed him with contempt – a pariah who in his role as chief whistleblower had breached Japan Inc’s code of silence.
As it turned out, the Olympus scandal was a mere foretaste of what was to come. Four years later, Toshiba, which makes items ranging from laptops to nuclear power plants, revealed that it had hugely overstated its operating profits, ultimately by almost $1.2bn (£940m). Last year the car parts maker Takata filed for bankruptcy protection after deadly faults in its airbags triggered the industry’s biggest-ever safety recall.
More recently, Kobe Steel admitted falsifying data about the strength and durability of its aluminium and copper products, which are used in the transport and defence industries. And last month, KYB, a Tokyo-based hydraulics firm, admitted falsifying inspection data for equipment used to protect hundreds of buildings from major earthquakes, including venues for the 2020 Tokyo Olympics.
There is much that differentiates the Ghosn case from other Japanese business scandals. The evidence against him was reportedly built around information from a Nissan whistleblower – proof, according to some observers, that western-style post-Olympus checks of power are beginning to take hold in Japan. In addition, the allegations centre on an individual rather then a company-wide attempt to cover up wrongdoing. But despite Nissan’s attempts to contain the fallout from their former chairman’s disgrace, questions were being asked about its internal governance, even as its chief executive, Hiroto Saikawa, portrayed the firm as a victim of “the dark side of the Ghosn era”.
“Corporate governance was clearly dysfunctional in Nissan when Ghosn was almighty,” says Koichi Nakano, a professor of political science at Sophia University in Tokyo. “The board members were not acting responsibly when the alleged offences were committed, and they are still not acting responsibly now by placing all the blame on Ghosn.”
After digesting the tumultuous events of the previous few days, Japanese newspapers were united in their disgust at the Ghosn allegations, but hurled similar invective in the direction of the Nissan executives who have now turned on their former chairman.
The Asahi Shimbun urged Nissan to fully disclose the results of its internal investigation into Ghosn and Greg Kelly, an American representative director who has also been arrested over the affair. “The company is in danger of falling into dysfunction unless it does its best to disclose whatever it can to its shareholders and comes up with measures to deal with the current crisis,” the newspaper said.
Attempts by Japan’s prime minister, Shinzō Abe, to introduce measures designed to improve corporate governance and shore up Japan’s reputation among overseas investors have had mixed results. Since he began revamping the corporate code in 2014 – the “third arrow” of his Abenomics growth strategy – there are signs that firms are being more responsive to long-ignored activist shareholders, and there are more outsiders sitting on company boards.
But the changes have done little to address either the culture of secrecy or the strict hierarchical management structures that encourage misconduct, says Jeff Kingston, director of Asian studies at Temple University in Tokyo.
“Corporate governance in Japan remains elusive because corporate culture here remains parochial and dominated by insiders,” he says. “Boards provide spotty oversight because they embrace an averted-eyes approach to their duties in the ‘get along, go along’ ways of Japan Inc.
“It’s laughable to imagine that Abe’s hesitant small steps towards improved corporate governance are what brought Ghosn down.
“Ghosn’s hubris, his hogging of the limelight, and his massive compensation angered other Nissan executives, who waited for the right time to take their revenge.”
As the appetite wanes for heaping scorn on Ghosn for his personal shortcomings and his disdain for the “Japanese qualities” of modesty, restraint, teamwork and egalitarianism, the focus is expected to shift to the criminal investigation and what, if anything, Japan’s corporate world is doing to salvage its battered reputation.
Part of the solution, says Parsons, lies in making Japanese company boards more diverse. “Any real movement to change the corporate culture so more women can operate at a board level with equal levels of authority would certainly create a seismic shift in the way Japan does business,” she says.
Ghosn denies he fiddled finances as prosecutors press their case
THE ASAHI SHIMBUN
November 26, 2018 at 13:35 JST
Carlos Ghosn when he was chairman of Nissan Motor Co. (Asahi Shimbun file photo)
Carlos Ghosn, recently ousted as chairman of Nissan Motor Co., is denying allegations of under-reporting his remuneration by at least 5 billion yen ($44.3 million) over a five-year period, investigative sources said Nov. 25.
This is the first time word has filtered out that he denies any wrongdoing since his arrest Nov. 19. He is being held at the Tokyo Detention House.
Ghosn has told investigators he did not engage in any financial misconduct.
Greg Kelly, a former representative director of Nissan who was arrested with Ghosn, insists he handled his boss’s financial matters appropriately, according to the sources.
Ghosn and Kelly were arrested on suspicion of conspiring to report only half of Ghosn’s compensation in the company’s financial reports from fiscal 2010 to 2014 in the violation of the Financial Instruments and Exchange Law.
The carmaker’s financial reports only declared Ghosn’s yearly remuneration as about 1 billion yen, even though it was double that figure.
Investigators say creative accounting was used to disguise the difference in total remuneration by drawing up a contract to guarantee that Ghosn would be paid the accumulated amount after his retirement.
A new document was produced each year to specify that Ghosn was entitled to the payment after his retirement from the board.
The Special Investigation Department of the Tokyo District Public Prosecutors Office says the remaining half should have been included in Nissan’s financial reports as his future compensation was set in stone.
But Kelly, a U.S. lawyer, is expected to argue that the money Ghosn was to be paid after his departure from the board did not amount to executive compensation and thus is not subject to disclosure in financial reports, according to the sources.
Kelly concluded after consulting with an outside lawyer and accountant that the way Ghosn’s remuneration was handled did not pose any legal problems.
A document is thought to exist that the outside lawyer drew up and declared the arrangement is clear of any legal problems.
Aside from the 5 billion yen in concealed future income over the five-year period, Ghosn is suspected of having under-reported 3 billion yen or so from fiscal 2015 to 2017, bringing his total unreported compensation to 8 billion yen, according to the sources.
Ghosn was removed as Nissan’s chairman and representative director at an extraordinary board meeting on Nov. 22. Kelly was stripped of his post of a representative director. But both remain on Nissan’s board.
Letter from a Person Who is Concerned about the Nissan Affair: a View from the Inside of Another Company
As you might imagine I have been besieged by inquiries from the press when I have little knowledge of what is going on, or went on, a Nissan. I also received this spontaneous email from a friend who is concerned about the Nissan-Ghosn affair. Having “sanitized” it, with permission I am posting it. This particular person worked in matters related to legal compliance for 10 years at a major Japanese company.
Dear Mr Benes:
I retired nine months ago and after a long vacation, recently I have finally got around to looking for an outside director or other similar position.
Anyway, I wanted to write because I was floored by the whole Ghosn spectacle. I am not close to that company, but was astounded that they chose to turn over and have arrested two foreign senior staff (Chairman and his aide) for redirecting assets to his own account “over several years.” I was floored because:
a) Neither of them is likely that spiffy at Japanese and would need other staff to prepare the transactions for them. Indeed even had they been Japanese staff themselves this would have required a certain amount of nemawashi at least the way the companies I am familiar with are now run. Gone are the days when 10,000 here and 100,000 there can be disbursed at some executive’s personal discretion.
b) Where were the kansayaku during all this. Either incompetent or complicit. Nihil est tertium. [no other choice]
c) Where were the outside directors with executive compensation review committees? Ditto
d) Why were none of the staff whose job it was to stop this or report this kind of thing if they could not and who had been either ignorant or complicit either arrested or brought in for questioning?
I will keep it short. I am sure you have at least 3 levels of information more than I have and that I am quite wrong about some things. [Benes: Actually I do not.] But this is how it looks on the streets and with rumours in the Shukanshi world flying furiously about that this is a coup d’etat designed to drive the French out of the whole operation it looks hideously incompetent and incestuous. Just like Olympus. Just like Toshiba. Things are not getting better. My uninformed view from the street. But there is a danger this is how it will be perceived.
I encouraged a couple of reporters who know about such things to pursue the story wherever it leads though no doubt the Japanese press is way ahead.
Anyway, unless a better explanation begins coming out I fear there is a danger that Japan may be looking like it has a rustic parochial throw the foreigners out -by deceit if necessary- tendency at the corporate level. This after what I felt were some immense changes and improvements in the Japanese business world over the last decade.
I think it is extremely important for Japanese industry that a true and understandable story (whatever that may be) gets told and that the system can be seen to be somehow working properly. I hope I am fortunate enough to see you join the fray at some point.
I have no particular objective but to express what this whole thing looks like to someone who worked “inside” of a Japanese company for 30 years. You probably do not need it but if it together with whatever other information you must have is of any use then I am happy.
(Posted by Nicholas Benes, who received this email from a friend. )
Victim of plea bargaining? Carlos Ghosn’s arrest based on murky evidence, former prosecutor says
Japan Times, BY MAGDALENA OSUMI AND SATOSHI SUGIYAMA
STAFF WRITERS, NOV 26, 2018
A prominent lawyer and plea deal expert said Monday that Nissan’s ex-Chairman Carlos Ghosn, suspected of violating financial law, may have fallen victim to Japan’s recently established plea bargaining system, leading to an arrest despite a lack of clear incriminating evidence.
Ghosn, who was dismissed Thursday as chairman of Nissan Motor Co. and removed from the same position at Mitsubishi Motors Corp. Monday, was arrested on Nov. 19 on suspicion of underreporting his income by around ¥5 billion for five years through fiscal 2014. He received nearly ¥10 billion over that period. He is also suspected of misusing company funds to pay for a luxurious lifestyle.
But Nobuo Gohara, a former prosecutor and now lawyer at Gohara Compliance and Law Office in Tokyo, believes the legal grounds for Ghosn’s arrest are murky.
“I think it’s a common procedure for prosecutors to collect enough hard evidence and consult with legal authorities, but this time around it was not clear what the hidden payment was,” Gohara said at a news conference at the Foreign Correspondents’ Club of Japan in Tokyo.
He called the investigation that led to Ghosn’s arrest “violent” and “haphazardly done.”
Gohara said that prosecutors arrested Ghosn only on the assumption that he had violated the Financial Instruments and Exchange Law. He added that it was highly likely the sum missing from Ghosn’s securities report — leading to his arrest as well as the arrest of his aide Greg Kelly — was the equivalent of money Ghosn was entitled to receive after leaving the company.
“If Mr. Ghosn’s crime stems from the fact that he and other people failed to accurately describe the scheduled payment in a security report, there’s no such requirement,” he said.
Gohara also suggested that the underreported amount could have been from a stock deal known as stock appreciation rights, or SAR. But if that were the case, he said, Nissan’s other executives, including CEO Hiroto Saikawa, would also be held liable since they would also have participated in the arrangement.
In Ghosn’s arrest, prosecutors used Japan’s plea bargaining system that was introduced in June through legal amendments. It allows for the acceleration of court proceedings for crimes such as bribery, embezzlement, tax fraud and drug smuggling.
Under the system, defendants can plead guilty to lesser offenses in exchange for more lenient sentencing or the dismissal of other charges. It also allows criminal suspects to negotiate deals with prosecutors in exchange for information on other suspects, which Gohara says can encourage people to give false statements.
Gohara hinted that it’s possible Nissan insiders who were at odds with Ghosn might have orchestrated a plot to push him out.
Gohara also offered wider criticism of Japan’s criminal justice system, saying that the principle of being innocent until proven guilty is not always upheld.
Ghosn has reportedly denied the allegations against him.
“Ghosn can only defend himself through the trial, but even if he’s innocent it will take time to prove it,” Gohara said. “The scandal has already damaged his reputation and he has lost his influence as he has already been dismissed.”
The Ghosn Inquisition
The troubling arrest and firing of Nissan’s long-time executive.
The Editorial BoardNov. 26, 2018 7:15 p.m. ET
The Editorial Board
A CEO once hailed as a business savior is arrested at the airport, held in detention for days without being charged, interrogated by prosecutors without a lawyer present, and fired from his post amid media leaks claiming he’s guilty of financial malfeasance.
Communist China? No, capitalist Japan, where former Nissan Motors CEO Carlos Ghosn is enduring a bizarre inquisition. The publicly available facts are murky, but the episode ought to trouble anyone concerned with due process and corporate governance in Japan.
The Ghosn Inquisition – WSJ – Wall Street Journal
Wall Street Journal says Carlos Ghosn enduring ‘bizarre inquisition’ in Japan
JIJI, NOV 28, 2018
NEW YORK – Ousted Nissan Motor Co. Chairman Carlos Ghosn is enduring a “bizarre inquisition” in Japan, a Wall Street Journal editorial said Tuesday.
He has been “held in detention for days without being charged, interrogated by prosecutors without a lawyer present, and fired from his post amid media leaks claiming he’s guilty of financial malfeasance,” the U.S. business daily wrote.
“Communist China? No, capitalist Japan, where … Ghosn is enduring a bizarre inquisition,” said the editorial printed in the paper’s Tuesday edition and headlined “The Ghosn Inquisition.”
Japan’s judicial system allows detention of suspects for up to 23 days without charges being filed.
“Such treatment is more appropriate for a yakuza mobster than an international CEO with no previous record of fraud or self-dealing,” the editorial said.
The allegations that he underreported his pay in Nissan securities reports are “odd in that Nissan should long have been aware” of the practice, the article noted.
It indicated that behind the arrest was friction between Nissan and its top shareholder and alliance partner, Renault SA.
“You don’t have to be a conspiracy theorist to look at these events and wonder if they are part of a larger effort to end Mr. Ghosn’s plan to merge Nissan with Renault,” said the editorial.
It added that without more transparency in investigations, “the Nissan ambush will stand as a black mark on Japanese business.”
‘Palace Coup’ at Nissan was Japan Inc. Striking Back
, Fund Says
By Tom Redmond and Takako Taniguchi
November 28, 2018, 10:00 AM GMT+9
Dalton’s Rosenwald calls on France to protect shareholders
Japan Inc. ‘fighting back’ against merger plans: Rosenwald
Jamie Rosenwald, who runs the $4 billion hedge fund Dalton Investments, says shareholders are being mistreated after Nissan Motor Co. ousted its former chairman Carlos Ghosn.
Rosenwald, who has invested in Japan shares since 1972 and campaigned for the country’s firms to better treat investors, says Ghosn’s arrest and removal amount to a “palace coup” by Nissan, and that shareholders are being ignored.
“Japan Inc. is fighting back” against Renault SA’s desire to take full control of Nissan, Rosenwald said. “If a ‘real’ owner of Renault existed rather than it being an ‘SOE,’ the owner would immediately call a special shareholders meeting and throw the entire Nissan board out.”
Rosenwald has prior experience clashing with vested interests in Japan. Before the financial crisis he failed in two bids to take Japanese companies private, while in March last year he urged Shinsei Bank Ltd. to buy back 200 billion yen ($1.76 billion) in shares, a move that put him on a collision course with the Japanese government, the largest holder of Shinsei’s stock.
On Nissan, Rosenwald says he has no doubt that Ghosn’s arrest and firing were linked to attempts to merge the Japanese carmaker into the organization of Renault, its largest shareholder, a claim that Nissan’s management has denied. The U.S. investor says he doesn’t own shares in Nissan but is following the events from a corporate governance perspective.
The board of Mitsubishi Motors Corp., where Ghosn also served as chairman, ousted the 64-year-old Franco-Brazilian executive on Monday, following Nissan’s decision to do so last week. Rosenwald says these moves are being carried out without regard for investors.
“Shareholders of Nissan were saved by Ghosn’s actions in 1999-2000,” he said. “And they are now being ignored in the fight.”
The U.S. investor called on the French government, which owns 15 percent of Renault, to step in to protect shareholders’ interests. French Finance Minister Bruno Le Maire on Sunday called the alliance “indispensable” and said he wants to strengthen it.
“I am sure that Japan Inc. would like Nissan to buy out Renault so they can go their separate ways,” Rosenwald said, “but really isn’t it the duty of the President of France, or at least the Finance Minister” to “stand up for shareholders?”
Deputy prosecutor: ‘No problem’ with Ghosn’s extended detention
November 30, 2018 (Mainichi Japan)
Speaking at a regular news conference on Nov. 29, deputy prosecutor Shin Kukimoto said of Ghosn’s detention, “It is based on a warrant issued by a court under the legal system and there is no problem with it.”
His comments followed some overseas media reports critical of the length of time Ghosn has spent in detention. A number of foreign media reporters attended the news conference.
“Countries have their own histories, cultures and systems, and I wonder about people easily criticizing another country’s system just because it’s different from their own one,” Kukimoto said. He said that full audio and video recordings were being made of the questioning of the former chairman, which was being done through an English interpreter.
仏メディア ゴーン前会長の勾留延長 批判的に伝える
NHK 2018年12月1日 0時36分
Carlos Ghosn’s arrest is more about Japanese criminal justice than corporate governance
BY COLIN P.A. JONES
DEC 1, 2018 ARTICLE HISTORY
Within days of Carlos Ghosn’s arrest for understating his compensation in Nissan’s regulatory filings came the predictable questions about what this meant about Japanese corporate governance.
No, the real significance of his arrest will likely prove to be in subjecting Japan’s criminal justice system to intense global scrutiny. You can’t use a reporting violation as a pretext for detaining a famous Brazilian-Lebanese-French business leader associated with multiple global automotive brands in an unheated cell for weeks with limited access to lawyers and almost no contact with family members before formally charging him with a crime without generating some negative press. In a Nov. 22 article on news analysis site Agora, former economy ministry bureaucrat and university professor Kazuo Yawata wondered whether Ghosn’s arrest and removal might be a sign of the “suicide of Japan’s judicial system.”
What follows are some key points on how that system works.
1) It’s not the police
Within a day of his arrest, Japanese tabloid magazines had stories out full of salacious details from anonymous sources about his extravagant, allegedly Nissan-funded lifestyle. Such details were irrelevant to the grounds for his arrest, but the goal is to paint the suspect as a “bad person.” Narrative control is a recurring theme of the process.
3) ‘Hostage-based’ criminal justice
In Japan, the first time a suspect sees a judge is not an arraignment hearing in open court where they are informed of the charges being brought against them so they can prepare a defense.
Although now detained, the suspect is not yet a defendant: They have not yet been prosecuted for anything, not even the crime for which they were arrested. Under the Code of Criminal Procedure, detention is essentially an investigative tool used to interrogate suspects and develop evidence. Suspects in detention have a constitutional right to counsel but not to have a lawyer present during questioning. In fact, the Code of Criminal Procedure empowers prosecutors to subordinate a suspect’s access to their lawyer to the needs of the prosecutor’s investigation.
Defense lawyers thus have to wait until the end of the day to find out what their clients may have already admitted to.
4) Confessions and punishment without trial
Think about it: How long could you simply vanish, separated from family, pay bills, respond to e-mails or do your job, before it caused serious long-term damage to your life and career? In addition to encouraging confession, even a false one proffered just to escape the stress of constant interrogation and life in an uncomfortable cell in a facility controlled by your interrogators, the pre-charge detention system gives police and prosecutors in Japan incredible powers to punish someone severely without even putting them on trial. Ghosn’s career as an executive at Nissan and possibly anywhere else has been terminated based on allegations that may never be proven in court.
5) Have prosecutors taken sides?
Perhaps he will ultimately be convicted of every charge brought against him. Given the impact the arrest has had on whatever plans Ghosn may have had for Nissan (including a possible merger with Renault) Japan’s prosecutors will invariably be suspected of “taking sides” — the Nissan side — in what is essentially a cross-border corporate spat.
I like to think Japan’s elite prosecutors are above such things. Nonetheless, awareness of how this case will affect their reputations — not just in Japan but around the world — will doubtless create intense pressure to ensure Ghosn is found culpable, ideally at trial but at least in the court of public opinion. The tools they have to force such a result are frightening and seem easy to misuse.
Colin P.A. Jones is a professor at Doshisha Law School in Kyoto and primary author of “The Japanese Legal System” (West Academic Publishing, co-authored with Frank Ravitch). The views expressed are those of the author alone.
full text at:
逮捕状 執行され 拘置所へ
Ghosn’s legal woes highlight governance failings in Japan
THE ASSOCIATED PRESS
December 3, 2018 at 16:35 JST
One of the biggest mysteries surrounding the arrest of Nissan’s former chairman Carlos Ghosn is over how he allegedly could have underreported his income by millions of dollars for years and why the company is going after the suspected wrongdoing now.
Ghosn, who headed the Renault-Nissan-Mitsubishi Motors auto alliance, was arrested Nov. 19 on suspicion he underreported his income by $44 million (5 billion yen) over five years, or about half of what he was really making. Nissan Motor Co. and Mitsubishi have ousted him as chairman; the board of Renault SA of France says it’s waiting for more evidence.
Nissan is among a growing list of top-name Japanese companies whose corporate governance has been found lacking in recent years.
“Wait a minute. Who wrote the financial statements? The accountants. Who audited them? The auditors,” Christopher Richter, auto analyst for CLSA Securities Japan Co., said of the case. “How do you do this without other people being complicit?”
Japanese prosecutors say Ghosn and another Nissan executive, Greg Kelly, an American suspected of collaborating with him, were arrested because they are considered flight risks. But the timing of the scandal, given the length and scale of the alleged wrongdoing, is raising questions.
Why did Nissan choose to come forward now, asks Eric Schiffer, chief executive of Reputation Management Consultants in the Los Angeles, California, area.
“If Nissan knew about this all along and decided to pull the trigger, such Machiavellian tactics will significantly backfire on the brand,” Schiffer said.
Japanese media have reported that two other company employees contacted authorities as whistle-blowers and sought plea deals. Ghosn has not made any public statements about the case.
Kelly’s American lawyer Aubrey Harwell said his client, who was dismissed as a Nissan executive director after his arrest, did nothing wrong.
Kelly acted “according to the law and according to company policy,” Hartwell said. “He had talked to people in the company and to outsiders, and he believed everything he did was done totally legally,” he said in a telephone interview from his office in Nashville, Tennessee.
Prosecutors have released very little information. Neither man has been officially charged. Under the Japanese system, suspects can be held for weeks for questioning without any charges.
A source familiar with an internal investigation by Nissan said the hidden salary was categorized as “deferred income,” meaning it was promised for later on, such as after Ghosn’s retirement, and the documents promising the money were kept secret from auditors and others. He spoke on condition of anonymity as he was not authorized to discuss such details.
One possible motive is that Ghosn was seeking to avoid public criticism over his multimillion dollar paychecks, which are a rarity in Japan even for top executives. Even the underreported amounts, about 1 billion yen ($9 million) each year, drew unwelcome scrutiny and commentary.
Ghosn was forced to defend his salary at shareholders’ meetings beginning in 2010, when Japan began requiring the disclosure of individual executive pay.
Executive pay packages in the west tend to be higher–Toyota Motor Corp.’s Chief Executive Akio Toyoda earns less than 400 million yen a year. But many Japanese companies lack the sorts of systematic checks required for publicly listed U.S. companies. That includes periodically changing who checks financial statements instead of having the same people do it for many years.
Japan needs independent oversight for executive pay, said corporate governance expert Takuji Saito, who teaches at Keio Business School.
“The problem here was that the pay was significant, in line with global standards, but the way it was decided was still so Japanese,” he said of Nissan’s lack of transparency. “Nissan deserves criticism for having allowed this to continue unchecked for so long.”
Saito believes that failing to report deferred income is still “a gray area in criminality” in Japan, but a clear problem in corporate governance.
It’s certainly turned out to be a big problem for Ghosn, 64. He is being held at a Tokyo detention center pending his indictment or release and has hired Paul, Weiss, Rifkind, Wharton & Garrison LLP to represent him.
Japanese media say, without citing sources, that Ghosn is asserting his innocence, insisting he always wanted his income reports to be legal and denying he signed secret documents. Prosecutors have refused to comment.
Whether a suspect intended to commit a crime or did it unknowingly is important in determining criminality under Japanese law.
Nissan veteran Hiroto Saikawa, who took over from Ghosn as the automaker’s chief executive last year, has harshly criticized his former boss and vowed to instill greater transparency and accountability at Nissan. The company is setting up a panel of outsiders to come up with recommendations, including reviewing the company’s executive compensation system.
The raft of scandals at many blue chip Japanese companies suggests managers are struggling to meet sometimes overly ambitious profit targets amid slowing demand, labor shortages, rising costs and intensifying competition. But they also highlight a rift between old-guard practices and an increasingly global business world in Japan.
–Major steelmaker Kobe Steel was charged with violating competition laws after massive faking over many years of quality data for products sent to hundreds of companies, including aluminum castings and copper tubes for autos, aircraft, nuclear power plants, appliances and trains. Kobe Steel said a zealous pursuit of profit, unrealistic targets and an insular corporate culture caused the wrongdoing.
–In 2016, Mitsubishi Motors Corp. disclosed it falsified mileage data. That followed a massive cover-up over decades of auto defects thought to have helped cause a fatal accident. In 2004 its president, Katsuhiko Kawasoe, was arrested. He was sentenced to three years in prison, suspended for five years, and did not serve time in jail.
–In 2015, electronics maker Toshiba Corp. said it had doctored its books in a systematic accounting cover-up that began in 2008 or earlier. The company declared bankruptcy, stricken by troubles in its nuclear business after multiple meltdowns in March 2011 at a power plant in Fukushima, northeastern Japan.
–Beginning in 2014, auto parts supplier Takata Corp. recalled more than 100 million defective air-bag inflators linked to 25 deaths and more than 180 injuries worldwide. Last year, Takata pleaded guilty to fraud in a U.S. court and agreed to pay more than $1 billion in penalties.
These scandals and more, from faked data to cutting corners, have driven calls for stricter corporate oversight. Reflecting widespread sentiments, Schiffer, the brand management expert, says he finds it hard to believe Nissan insiders weren’t aware of what was going on earlier.
Otherwise, they were “incompetent,” he said.
Auditor queried Nissan about subsidiary’s ‘unclear’ role
THE ASAHI SHIMBUN
December 3, 2018 at 16:05 JST
Nissan Motor Co.’s auditor questioned transactions by a subsidiary that may have a bearing on allegations of financial misconduct that led to the arrest of ousted chairman Carlos Ghosn.
The auditor expressed its concerns several times around 2013 about acquisitions of several luxury properties overseas that were offered for Ghosn’s private use, and wanted to know precisely what the subsidiary was set up to do.
Nissan responded that everything was aboveboard with regard to the subsidiary, Zi-A Capital BV, based in Amsterdam, sources said Dec. 2.
The subsidiary’s board members included former Nissan representative director Greg Kelly, 62. He and Ghosn, 64, were arrested Nov. 19 on suspicion of under-reporting Ghosn’s remuneration.
An executive of the secretary’s office of Nissan also served as a board member of the subsidiary and was involved in the creation of documents that stipulated the carmaker would defer a portion of Ghosn’s annual remuneration until after his retirement.
Along with a Nissan corporate officer, the executive who had served Ghosn for many years reached a plea-bargaining deal with the Special Investigation Department of the Tokyo District Public Prosecutors Office.
Ghosn, who is alleged to have violated the Foreign Instruments and Exchange Law, is being held at the Tokyo Detention House.
Prosecutors suspect that a limited number of aides may have assisted Ghosn in his financial dealings, sources said.
The Amsterdam-based subsidiary was established in 2010 with about 6 billion yen ($53 million) in capital to make investments in venture businesses.
It purchased luxury properties in Rio de Janeiro and Beirut through a sub-subsidiary it set up in the British Virgin Islands, a tax haven.
The Brazilian-born Ghosn also has French and Lebanese nationality.
The costs to purchase and maintain the properties amounted to several billions of yen. The house in Beirut required extensive renovations under local regulations as it is located in a historic district.
The homes were offered to Ghosn and his family members for their private use.
According to the sources, the auditing company told the carmaker several times around 2013 that the subsidiary’s activities in investing in venture businesses were unclear.
The subsidiary was not subject to Nissan’s financial results on a consolidated basis, and for this reason was not covered by the audit.
Even so, the auditor noticed the problem while checking the flow of funds from and into Nissan.
However, company officials explained that the subsidiary was engaged in making sound investments and there was nothing to worry about.
The special investigation department now has a clearer idea of why the overseas properties were purchased.
Ghosn told investigators that the properties were necessary because he frequently traveled around the world on business, the sources said.
Kelly told investigators that Ghosn had planned to purchase the homes at appropriate market prices after his retirement.
Carlos Ghosn continues to deny wrongdoing as experts question prosecutors’ framing of case
KYODO, AP, DEC 3, 2018
Ousted Nissan Motor Co. Chairman Carlos Ghosn has continued to deny allegations of financial misconduct, saying he cannot accept making what he said would be a false confession as doing so would harm his reputation, sources said Monday.
The 64-year-old, who is known for rescuing Nissan from the brink of bankruptcy in the 1990s, was arrested last month for allegedly understating his compensation. He was subsequently removed as chairman of the automaker.
He is suspected of breaching the Financial Instruments and Exchange Law by reporting only ¥5 billion ($44 million) of his ¥10 billion in compensation during the five years through March 2015.
Ghosn’s annual compensation had been set at around ¥2 billion, but he is charged with failing to report around half of the amount, which he was to receive after stepping down.
Ghosn has told prosecutors that it was unnecessary to report some of his remuneration as the payment had yet to be settled, according to different sources with knowledge of the investigation. He was also quoted as saying that the remaining remuneration was just an amount he had hoped to receive.
According to the sources, Ghosn said he consulted with close aide Greg Kelly, 62, a former Nissan representative director who was arrested along with Ghosn for alleged conspiracy, and was told by Kelly that it was legal even if he did not report the post-retirement payment.
The post-retirement compensation that went unreported for eight years through March 2018 is believed to have totaled more than ¥8 billion. Prosecutors are also considering charging Ghosn over ¥3 billion he failed to disclose during the three years through this March.
Ghosn and Kelly were arrested Nov. 19 and their detention period will expire next Monday.
As the detention period has grown longer, experts have questioned the way prosecutors have framed the case.
One of the biggest mysteries surrounding Ghosn’s arrest is over how he allegedly could have underreported his income by millions of dollars for years and why the company is going after the suspected wrongdoing now.
“Wait a minute. Who wrote the financial statements? The accountants. Who audited them? The auditors,” Christopher Richter, auto analyst for CLSA Securities Japan Co., said of the case. “How do you do this without other people being complicit?”
Prosecutors say Ghosn and Kelly were arrested because of flight risks. But the timing of the scandal, given the length and scale of the alleged wrongdoing, is raising questions.
Why did Nissan choose to come forward now, asked Eric Schiffer, chief executive of Reputation Management Consultants in the Los Angeles area.
“If Nissan knew about this all along and decided to pull the trigger, such Machiavellian tactics will significantly backfire on the brand,” Schiffer said.
Media reports have said that two other company employees contacted authorities as whistleblowers and sought plea deals. Ghosn has not made any public statements about the case.
Kelly’s American lawyer, Aubrey Harwell, said his client, who was dismissed as a Nissan executive director after his arrest, did nothing wrong.
Kelly acted “according to the law and according to company policy,” Hartwell said. “He had talked to people in the company and to outsiders, and he believed everything he did was done totally legally,” he said in a telephone interview from his office in Nashville, Tennessee.
Prosecutors have released very little information. Neither man has been officially charged. Under Japan’s criminal justice system, suspects can be held for weeks and months for questioning without any charges being formally filed.
Nissan panel delays decision on Ghosn successor
December 5, 2018 at 08:00 JST
Nissan Motor Co. failed on Tuesday to nominate a successor to Carlos Ghosn as chairman in the wake of his arrest and dismissal for alleged financial misconduct last month, a source familiar with the situation said.
A three-member panel of external Nissan directors put off a decision on recommending a replacement for the jailed Ghosn. The carmaker declined to comment.
Ghosn’s arrest to face accusations including the under-reporting of income has triggered new attempts by Nissan to weaken Renault’s control of their Franco-Japanese alliance.
Renault’s board is due to meet on Wednesday to discuss the crisis, two sources with knowledge of the matter told Reuters.
Ghosn, 64, was the architect of the alliance and one of the best known figures in the car industry.
Nissan has tasked former trade and industry official Masakazu Toyoda, retired Renault SA executive Jean-Baptiste Duzan and race car driver Keiko Ihara with the selection of a new chairman, which is to be submitted to the rest of the board at their next meeting on Dec. 17. Changes to the board must be approved by shareholders.
Ghosn has been detained in Tokyo since his Nov. 19 arrest on suspicion of conspiring with former Nissan Representative Director Greg Kelly to understate his compensation by about half of the actual 10 billion yen ($88 million), over five years from 2010. Tokyo authorities on Friday extended their detention until the maximum Dec. 10 for the alleged crime.
In Japan, crime suspects can be kept in custody for 10 days and that can be extended for another 10 days if a judge grants prosecutors’ request for extension. At the end of that period, prosecutors must file a formal charge or let the suspect go.
However, they can also arrest suspects for a separate crime, in which case the process starts over again. This process can be repeated, sometimes keeping suspects detained for months without formal charges and without bail.
Ex-Nissan chief Ghosn to be served with fresh arrest warrant
December 4, 2018 (Mainichi Japan)
TOKYO (Kyodo) — Tokyo prosecutors have decided to seek a fresh arrest warrant for former Nissan Motor Co. Chairman Carlos Ghosn on suspicion of failing to report around 4 billion yen ($35.5 million) of his remuneration in its securities statements for the three years through March, investigative sources said Tuesday.
Ghosn, who is being held at a Tokyo detention center, has already been accused of breaching the Financial Instruments and Exchange Act by stating only 5 billion yen of his 10 billion yen compensation during the five years through March 2015, in the securities reports submitted to Japanese regulators.
Along with Greg Kelly, a former Nissan representative director, Ghosn is expected to be served with a fresh arrest warrant on Dec. 10, when the detention period for the pair expires.
Ghosn and Kelly, who was arrested along with the former chairman on Nov. 19 for alleged conspiracy, have told the prosecutors that it was unnecessary to report some of the remuneration as the payments had yet to be settled, according to different sources with knowledge of the investigation.
However, the prosecutors believe the pay packages were settled as they have found multiple documents, including at least one bearing Ghosn’s signature and the date, which specify the amount to be received after his retirement.
The unreported remuneration of the 64-year-old charismatic automotive industry figure, known for rescuing Nissan from the brink of bankruptcy in the 1990s, is believed to total 9 billion yen.
Ghosn’s pay package is believed to have increased every year after fiscal 2010, including the unreported portion that he was planning to receive after his retirement.
Ghosn’s actual compensation was less than 2 billion yen in fiscal 2010 but rose over the years, reaching about 2.5 billion yen each in the last two fiscal years, 2016 and 2017, according to sources familiar with the matter.
The remuneration paid by Nissan to Ghosn and other executives in fiscal 2016 and fiscal 2017 may have exceeded the 2.99 billion yen cap that was adopted at a general shareholders’ meeting in 2008, after taking into account the former chairman’s actual payments.
Under Nissan’s rules, remuneration payments for each executive should be decided through talks involving the board’s chair and representative directors. But the sources believe that Ghosn alone had been effectively deciding how much he was paid.
If served with a fresh arrest warrant, Ghosn could be detained through Dec. 30 based on Japan’s Code of Criminal Procedure.
The Tokyo District Court approved Friday a request from the prosecutors to extend Ghosn’s detention through Dec. 10, before which they have to decide whether to indict or release him.
Japanese law sets detention limits for a suspect of 23 days for an arrest warrant served by police and 22 days for a warrant served by prosecutors. However, authorities can add further charges with fresh warrants, meaning a person can be detained indefinitely if a court approves it.
While visits to the detention center are restricted, lawyers and embassy officials are allowed to meet with Ghosn, who holds Brazilian, French and Lebanese citizenship.
Some overseas media organizations have been critical of the way Ghosn has been treated since his arrest, as concern has grown about the length of his detention.
It is believed that Ghosn is being held in solitary confinement. A typical solitary confinement cell at the detention center is about 7 square meters in size and the room has a window, but it is impossible for a detainee to look outside, according to the Justice Ministry.
Detention cell at a police station in Tokyo’s Shibuya Ward
Japan’s police cells evolving to meet changing demographics
BY TAKU IZUTA, DEC 5, 2018
Police holding cells, where those who have been arrested spend time until they are formally charged with a crime, are beginning to evolve as awareness grows across the criminal justice system about human rights and the country’s increasingly diverse populace.
As demographic changes lead police to process a growing number of elderly people, foreign nationals and sexual minorities who have fallen afoul of the law, facilities must meet a wider range of health and dietary needs and requirements of people with various gender identities.
According to the 2018 Police White Paper, detention cells, whose main purpose is to prevent released suspects from destroying evidence or fleeing while they await indictment, are hosted in 1,140 police facilities in the country and hold about 8,600 detainees in custody on average per day.
As a standard, detainees are each allotted 2.5 sq. meters of space in their shared police cells. Detainees are accompanied by guards daily when moving to be interrogated by police or prosecutors and are allowed to meet with their lawyers or receive books and clothing from family members, according to the MPD.
Police are allowed by law to keep pretrial suspects in cells even after their cases have been sent to prosecutors, instead of moving them to detention centers under the jurisdiction of the Justice Ministry.
Known as “substitute prisons,” the notorious system has long been criticized at home and abroad for giving police opportunities to coerce confessions or handle suspects roughly while they are under around-the-clock observation.
Police moved responsibility for police cell management from its investigation department to the general affairs department, which is not directly involved in investigations, in 1980.
But the practice of using substitute prisons is ongoing and continues as a means of facilitating criminal investigations.
Most suspects remain in police custody until their criminal prosecution, which usually comes within 23 days of an arrest. In principle, once suspects are indicted they are transferred to detention centers, and if convicted, sent to prison.
When prosecutors make an arrest, such as in the case of former Nissan Motor Co. Chairman Carlos Ghosn, who is being detained at the Tokyo Detention House for alleged misconduct in the reporting of his finances, suspects are held in detention centers from the start.
MPD detention administration director Miura insisted police are more considerate under her watch.
full article at:
Deferred pay paper show both Ghosn, Nissan official signed it
THE ASAHI SHIMBUN
December 6, 2018 at 15:10 JST
Documents on an agreement between Nissan Motor Co. and its former chairman Carlos Ghosn to defer half his remuneration show his signature and the signature of a senior official at the company’s secretary’s office, sources said.
The senior official is apparently cooperating with Tokyo prosecutors over the alleged under-reporting of Ghosn’s pay package in the company’s financial statements under the plea bargaining system introduced into Japan earlier this year.
The documents in question stated that Ghosn’s annual pay is about 2 billion yen ($17.7 million) although only half the sum was actually paid and the other half deferred.
They also stated that such an arrangement is based on the compensation contract that Ghosn reached when he joined Nissan in 1999 to turn around the troubled automaker.
A document that showed 2011 as the date of creation listed his remuneration for fiscal 2009 and fiscal 2010, according to the sources.
Another document stating 2013 as the date of creation showed his income for fiscal 2011 and fiscal 2012.
Both documents bore the signatures of Ghosn and the senior official at the secretary’s office.
Investigators at the Special Investigation Department of the Tokyo District Public Prosecutors Office believe that Greg Kelly, a former representative director of Nissan, masterminded the scheme to defer Ghosn’s remaining annual income until after his retirement as a Nissan board member, according to the sources.
Ghosn and Kelly allegedly planned to make such a payment under the guise of consulting or contract fees.
Investigators have also obtained a paper listing the pretext for the deferred payment that bore the signatures of Kelly and Nissan President and CEO Hiroto Saikawa, according to the sources.
Kelly has told investigators that the paper in question is merely a written plan on Ghosn’s post-retirement treatment and that it is not related to Ghosn’s remuneration.
He has also said he has no knowledge of the existence of the written agreement on Ghosn’s deferred payment.
Tokyo prosecutors are seeking to establish the case against the two for the under-reporting of about 9 billion yen in Ghosn’s income from fiscal 2010 to fiscal 2017. They were arrested in Tokyo on Nov. 19.
As for Saikawa’s signature on the document on the pretext for the deferred payment, investigators believe that he signed it without being fully aware of the existence of the documents concerning the deferred payment of his remuneration.
A Nissan public relations official declined to comment on the existence of Saikawa’s signature, citing the ongoing investigation by prosecutors.
Did former protégé pull trigger on car industry titan Carlos Ghosn?
09 DECEMBER 2018 – 19:51 AGENCY STAFF
Almost three weeks after his shock arrest in Japan, Carlos Ghosn’s relationship with his former protégé is emerging as key to determining what may have triggered the investigation that has put the car industry titan in a Tokyo jail cell.
Ghosn, who was ejected as Nissan’s chair shortly after his arrest, planned for months to shake up senior management at the carmaker and had made known his plans to replace CEO Hiroto Saikawa, the Wall Street Journal reported on Sunday, citing unidentified people familiar with the situation. Ghosn, who promoted the Nissan lifer to the CEO position in 2017, wanted to carry out his plan at a board meeting in November, one of the people told the newspaper.
But people familiar with Ghosn’s case and with Nissan’s operations told Bloomberg News there was no plan to eject Saikawa in November, or before the end of his term, which was due to run until April 2019. Any change in top management would have required the approval of the carmaker’s board, they said.
Saikawa could not be reached for a response, the Wall Street Journal said, and the office of Ghosn’s lawyer, Motonari Otsuru, declined to comment.
Relations had been strained between Saikawa and Ghosn for some time, the people who spoke to Bloomberg said, declining to be identified discussing private information.
The Nissan CEO emerged in 2018 as an opponent of Ghosn’s ambitions to deepen the company’s alliance with Renault SA via a merger. Saikawa publicly downplayed the chances of that being realised in May, prompting a dressing-down from Ghosn, according to a person familiar with the matter, who told Saikawa he was jeopardising Nissan’s credibility.
But from virtually the moment Ghosn was taken into custody by Japanese police on November 19, Saikawa moved rapidly to show he was in control. The CEO appeared alone at a late-night media conference just hours after the arrest and issued a frontal condemnation of Ghosn’s alleged behaviour, calling it “the dark side of Ghosn’s long reign”.
Asked outright if a coup was under way at Nissan, Saikawa replied: “That is not my understanding. I didn’t make such an explanation and think you should not think of it that way.”
Ghosn, who remains CEO of Renault despite his situation, is set to be indicted for financial crimes as soon as Monday, people familiar with the matter told Bloomberg last week.
Prosecutors are also planning to rearrest Ghosn on new charges not yet made public, said the people.
The Franco-Brazilian executive has been accused of under- reporting his income and misusing Nissan assets, crimes that could incur a sentence of at least 10 years in jail, according to Tokyo prosecutors. Ghosn has made few formal comments since being detained besides denying reports that he passed on personal trading losses to the carmaker.
Ghosn’s downfall has rocked the auto alliance he has created and led for decades, with Nissan said to be angling for more power in the pact in the wake of his arrest.
ゴーン前会長 “実際の報酬額”の文書 自ら修正した痕跡
2018年12月10日 4時57分ゴーン前会長 逮捕
Why Japan Needs Criminal-Justice Reform
Carlos Ghosn’s arrest is a reminder that the nation’s legal system is designed to coerce confessions, not maintain rule of law.
By Noah Smith
December 13, 2018
Japan’s police recently threw the chairman of Nissan Motor Co., one of the country’s largest auto manufacturers, into a jail cell. Carlos Ghosn, a Brazilian-born executive with French and Lebanese citizenship, has been accused of falsifying financial reports and hiding $44 million of personal income.
As my Bloomberg Opinion colleague Joe Nocera explains, Ghosn is unlikely to receive anything resembling justice. Officially, under Japanese law, a suspect can be held and questioned for 23 days without being charged. During this time he can be interrogated for as long as eight hours a day with no lawyer present. Unofficially, the holding period is much longer, because after the 23 days are up, the police can just re-arrest you for an additional crime and start the clock over again — Ghosn has already been re-arrested. Eventually, like almost all suspects in Japan, he will probably be forced to sign a confession, regardless of whether he is guilty.
Many will take this as a sign of Japanese xenophobia — Japan Inc. bringing down a foreigner who got too powerful. But Japan often does similar things to native-born executives. A decade ago, internet entrepreneur Takafumi Horie was sent to jail for insider trading (though he continued to assert his innocence). Around the same time, Yoshiaki Tsutsumi, a railroad and hotel magnate, pleaded guilty and was jailed for fraud.
To some, this might sound like justice — holding corporate executives accountable for white-collar crime is good. The problem is that Japan’s justice system is focused on forcing confessions, not on determining whether a suspect engaged in wrongdoing. This inevitably leads to miscarriages of justice. In 2008, a Japanese court reversed a lower court’s ruling and declared that three Japanese bank executives hadn’t broken the law. But their wrongful conviction had come almost a decade earlier — by the time they were exonerated, the three were old men, their lives and careers ruined. Two other executives had already committed suicide when the bank came under investigation. Such suicides are not uncommon.
And most of the people unfairly imprisoned by Japan’s unfair and arbitrary justice system are not high or mighty. Most of the people who are intimidated (or beaten) into signing false confessions by the Japanese police are simple blue-collar citizens who were arrested and charged because the police and prosecutors needed someone to blame for a crime. Japan’s fabled 99 percent conviction rate isn’t anything to brag about — it’s a sign that the rule of law is sacrificed to the desire to maintain the appearance of order.
This antiquated, barbarous system almost certainly has negative consequences for Japan’s economy. Rule of law — not simply keeping order, but determining guilt or innocence systematically and fairly — is extremely important for any economic system.
First of all, Japan’s lack of rule of law almost certainly makes companies less efficient. Because police and prosecutors are so determined — and so easily able — to convict anyone who gets accused of a crime, executives tend to avoid making tough but necessary economic decisions. For example, Nocera notes that Ghosn was arrested just as he was planning to merge Nissan with his old company, Renault. The merger was opposed by Nissan Chief Executive Officer Hiroto Saikawa, whom Ghosn had reportedly planned to fire. Saikawa denounced Ghosn immediately after his arrest, raising suspicions that the whole thing is just a corporate coup.
But more is needed in order to move away from the coercive-confession system. The first step is to change the law governing the 23-day holding period. Suspects should be given the right to have a lawyer with them at all times, and to be able to refuse questioning. Judges should be directed to deny most police requests for long holding periods, and suspects should be allowed to post bail. All police interrogations should be recorded, not just those involving serious crimes. Additionally, suspects who are exonerated should have the right to sue for wrongful arrest in civil court and receive substantial damages.
full text at:
Exclusive: Former Prosecutor Says, “If Ghosn is rearrested, NISSAN CEO should be arrested as well”
Nobuo Gohara (郷原信郎元検事)
The suspected offense of his violation of the Financial Instruments and Exchange Act turned out to be the fact that he did not describe the “agreement on payment of compensation after his retirement” in the securities report. However, given that the payment had not been determined and that it cannot be considered as a fake statement of an “important matter”, there are serious concerns about considering this non-description a crime.
A more significant issue is that it has been reported by Asahi, Nikkei, and NHK that Hiroto Saikawa, President and CEO of Nissan, has also signed the “document agreeing on the post-retirement compensation”. It has been reported that Mr. Saikawa has signed a document titled “Employment Agreement”, which describes the amount of compensation for the agreement prohibiting Mr. Ghosn to enter into any consulting agreement or to assume office as an officer with any competing companies after his retirement. It has also been reported that, apart from the above, a document was prepared which specified the amount of compensation which should have been received by Mr. Ghosn each term and the amount which had actually been paid, as well as the balance thereof, and that it was signed by Mr. Ghosn the ex-Chairman and the executive employees as his close aides.
The offense of the crime of fake statement in the securities report is constituted not by “making a fake statement” but by “submitting” the securities report with a fake statement on an important matter. The person who has an obligation to ensure accurate description and “submission” is the CEO in the case of Nissan, which is Mr. Saikawa from and after March 2017 term. If, as mentioned above, Mr. Saikawa had largely the same recognition with Mr. Ghosn with respect to the “post-retirement payment of compensation”, we have to say that it is Mr. Saikawa who would primarily be criminally liable for the last 2 years (apart from the severity of the ultimate sentence). That is, if the prosecutors are to pursue the indictment of the fake statement of the securities report for the last 3 years, it is inevitable to charge Mr. Saikawa as well.
It is possible that there is a “backdoor agreement” between the prosecutors and President Saikawa “targeting” Mr. Ghosn and Mr. Kelly. However, if such agreement exists, where it is agreed not to charge President Saikawa, what was it all about that he criticized Mr. Ghosn at the press conference immediately after his arrest, going so far as to say that he “felt resentment (toward Mr. Ghosn)”? There is likely to be severe criticisms against such agreement as well as against Mr. Saikawa domestically and internationally. Furthermore, if this is the case, it is likely that Mr. Saikawa falls under the “party with special interest” in relation to the extraordinary board meeting where he served as the chairman and determined the removal of Mr. Ghosn from his position of the Representative Director and Chairman. This may affect the force and effect of the vote (““Serious Concern” over Plea Bargain between Executives of Nissan and Prosecutors” – Are Directors Involved in Securities Report able to Participate in Voting relating to Removal of Ghosn?).
Given all of the above, if the prosecutors are to re-arrest Mr. Ghosn and Mr. Kelly on the ground of a fake statement in the securities report for the last 3 years, there is no other choice than to arrest Mr. Saikawa and hold him criminally liable.
more at, full text:
Nissan Motor Co. Chief Executive Hiroto Saikawa speaks during a news conference in Yokohama on Dec. 17.
Nissan board meets but no chairman picked to replace Ghosn
THE ASSOCIATED PRESS
December 18, 2018 at 07:45 JST
YOKOHAMA–Nissan’s board met Monday but failed to pick a new chairman to replace Carlos Ghosn, who was arrested last month on charges of violating financial regulations, saying more discussion was needed.
Nissan Motor Co. Chief Executive Hiroto Saikawa told reporters that the board approved a special committee of outsiders to strengthen governance at the company. A date for the selection of a chairman was not decided.
“We plan to be cautious in this process, and I do not plan to rush this,” Saikawa said.
The recommendations for beefing up governance are due in March, and Saikawa said he was willing to wait until then to choose a chairman.
The board meeting came amid an unfolding scandal that threatens the Japanese automaker’s two-decade alliance with Renault SA of France and its global brand, and highlights shoddy governance at the manufacturer of the Leaf electric car.
Ghosn and another board member Greg Kelly were formally charged last week with falsifying financial reports in underreporting Ghosn’s income by about 5 billion yen ($44 million) from 2011 to 2015. They were arrested Nov. 19 by Tokyo prosecutors and remain in detention.
A source close to Ghosn’s family says Ghosn is innocent, as the alleged income was never decided upon or paid. Aubrey Harwell, the U.S. lawyer for Kelly, an American, says he is innocent, and that Nissan insiders and outside experts had advised him that the financial reporting was proper.
The chairman must be selected from among the board members. Three outside board members–race-car driver Keiko Ihara, Masakazu Toyoda, an academic, and Jean-Baptiste Duzan, formerly of Renault–are making that decision.
The special committee for governance includes the three outside board members and four other outsiders, including former judge Seiichiro Nishioka.
One candidate for chairman is Saikawa, who was hand-picked by Ghosn to succeed him as chief executive. He has denounced Ghosn and Kelly as the “masterminds” in a scheme to falsify income reports and abuse company money and assets.
Renault has kept Ghosn as chief executive and chairman, saying its investigation has not found wrongdoing in the awarding of Ghosn’s compensation.
Nissan Motor Co.’s allegations also include million-dollar homes in several nations, including France, Japan, Brazil, Lebanon and the Netherlands, purchased by Nissan or a subsidiary and used by Ghosn.
Wrangling over a home in Rio de Janeiro has developed into a court battle in Brazil, with Nissan seeking to block Ghosn’s family from retrieving items.
Ghosn was born in Brazil of Lebanese ancestry and holds French citizenship. He was sent in by Renault in 1999 to turn around Nissan from the brink of bankruptcy.
It’s unclear when Ghosn and Kelly may be released, with Tokyo prosecutors saying they are a flight risk.
Japanese Justice Faces Scrutiny in Case of Nissan Chief and U.S. Board Member
The treatment of such a prominent foreign defendant has been revelatory for people who see Japan as a model in Asia for doing business. Ghosn’s arrest on Nov. 19 has exposed stark differences in how crimes are pursued and suspects are handled in Japan and in Western democracies.
Ghosn, who ran a global auto empire that included Nissan, Mitsubishi and the French carmaker Renault, was taken into custody just after his corporate jet landed at Haneda Airport. His arrest was seen as extraordinary given his position and history with Nissan.
It turns out that he has been treated much like any suspect in Japan.
A citizen of Brazil, France and Lebanon, Ghosn faces government lawyers, for hours, on his own. He is not allowed a lawyer during interrogation. Prosecutors can question him for weeks without charges, and can extend his detention with a routine court request. Last week, on the day he was indicted, Ghosn was rearrested on allegations of additional wrongdoing. A day later, he was ordered held, again without bail, for 10 more days.
There is some reason to see Ghosn, 64, as a flight risk. He is wealthy; he has no known family in Japan; and neither Lebanon nor Brazil extradites its own citizens, offering him a plausible place to seek refuge.
He is being held in a small room and can be visited only by diplomats or his Japanese lawyer, as foreign lawyers cannot offer legal services in criminal cases. He is allowed to request blankets and books, but all requests are reviewed by officials and can be rejected. Sheets of writing paper, for instance, have been denied.
Prosecutors are likely to hold Ghosn until they believe they will win a conviction. Kelly, who was indicted on the same charge, has been suffering from poor health and may be released for medical care. Members of his family have used Twitter to complain to U.S. officials about his condition while in jail.
In part, prosecutors’ methods are aimed at wresting confessions from suspects. About 90 percent of indicted suspects in Japan confess to a crime before trial.
“I think it reflects differences in the societies and cultures and the views of criminal justice,” said David Litt, an American professor of law at Keio University in Tokyo. “We have a view in the United States and Anglo-American systems where we have the greatest respect for the autonomy of individuals.”
In Japan, Litt said, “there is a deference to the authorities and to what they say.”
Ghosn’s arrest has been the talk of expatriates who see a possible chilling effect on foreigners willing to work in Japan. “If you start throwing people in jail for doing something in the gray area,” said Stephen Givens, an American corporate lawyer here who has been following the case, “everybody lays awake at night worrying that they’re next to hear the police knock on the door.”
Critics who say the Japanese system is biased against defendants have focused on its high conviction rates, but even in the United States, 90 percent of defendants indicted on a charge of a white-collar crime in federal court were found guilty in 2017, according to the most recent Justice Department figures. Japan also is not the only democracy that restricts a defendant’s access to counsel or holds suspects for weeks or months without charges.
German law allows suspects to be held for months if a judge rules that they might flee, obstruct justice or pose a danger to society. Rupert Stadler, the chief executive of Volkswagen’s Audi division, was held for almost five months without bail this year after he was heard on a wiretap making statements that prosecutors interpreted as an attempt to obstruct an investigation into emissions cheating.
The right to have a lawyer present during questioning is not sacrosanct across democratic countries.
In France, defendants can have a lawyer present during interrogations, but the lawyer is not allowed to interrupt–although in practice, they sometimes do, and they are allowed to ask questions when investigators are finished.
In the Netherlands, lawyers were not allowed in the interrogation room until last year, when the rights of defendants were expanded. As in France, lawyers in the Netherlands are not supposed to interfere with interrogations but can interrupt under certain conditions, such as if the defendant becomes too fatigued or distraught to answer questions.
In the United States, lawyers for witnesses and defendants are not permitted into federal grand jury proceedings, where suspects are indicted. Lawyers must wait outside the courtroom, and witnesses and defendants can leave the proceedings for counsel.
In Japan, detained suspects can meet with their lawyers outside of interrogations. Yoichi Kitamura, a lawyer for Kelly, visits his client daily, he said, and Kelly denies any criminal wrongdoing. Neither Ghosn nor his lawyer Motonari Otsuru have commented on the charges. Aubrey Harwell Jr., a longtime Nashville lawyer who represents Kelly, has not yet been allowed to speak to him.
“That’s how the system works when they decide to go after you,” said Nicholas Benes, a board director at the Board Director Training Institute of Japan, a nonprofit group that focuses on corporate governance. “They are keeping you that long to force you to admit to wrongdoing and make the prosecutors’ lives easy.”
Although a confession alone is not sufficient to secure an indictment, suspects come under pressure not only from prosecutors but also from judges who make bail decisions.
During the time when suspects are held but not yet charged, judges rarely grant bail. If a suspect does not confess, “sometimes the court does not approve bail,” said Yasuyuki Takai, a former prosecutor turned defense lawyer who advised Takafumi Horie, an internet tycoon who was found guilty of violating securities laws in a notorious trial a decade ago.
“If a suspect keeps denying the charges and insisting on their innocence, judges in Japan would worry that the suspect might destroy evidence if they are granted bail,” Takai said.
Ghosn and Kelly are not the first corporate defendants who have been jailed for weeks without charges.
In 2015, Julie Hamp, at the time the head of communications for Toyota Motor, was arrested and held for 2 1/2 weeks in detention in Tokyo on suspicion she had illegally imported the painkiller Oxycodone. She was released without charge and left Japan soon after.
In 2012, three executives from Olympus, the optical equipment maker, were arrested and detained for nearly six weeks after a wide-ranging investigation of accounting fraud at the company. All three were convicted although they received suspended sentences and served no prison time.
Horie, a larger-than-life Japanese entrepreneur, spent three months in detention before he was charged with securities fraud. After a six-month trial, he was convicted in 2007 and sentenced to 2 1/2 years in prison. He served 21 months before he was paroled.
Horie was held in the same detention center as Ghosn. In a blog published in 2010, Horie described how prosecutors pressed him to recall incidents entirely from memory and denied his requests to consult his company schedule or emails.
“Now I can say what their intention was,” Horie wrote. “Once I started describing vague memories, they could adjust it to fit their story. As my memory was unclear, it was easy to manipulate. If I had some discrepancies in my daily conversations with prosecutors, they could check it against all the email records.”
“Anyone would have doubts about their own memory or feel guilty,” Horie wrote, “if a prosecutor says ‘that’s not what you said yesterday. You’re telling a lie!’”
Life in detention was meager, Horie wrote. He slept in a 50-square-foot room with a toilet. Detainees could bathe twice a week in winter–three times in summer–and order items like toothpaste and shampoo once a week. A doctor visited inmates weekly.
Breakfast was miso soup and rice cooked with barley. Horie was allowed to order bento lunches from a specially vetted shop, but they were “not so tasty, to be honest.”
A senior Japanese government official said the prosecutors’ detention center provided each suspect with an air-conditioned cell. He said Ghosn was not being treated unjustly and that prosecutors were following Japanese laws. A spokesman for Japan’s Ministry of Justice said officials at the Tokyo Detention Center and all correctional facilities in Japan “try to respect inmates’ human rights.”
(Dec. 19, 2018)
日産ゴーン前会長ら 勾留延長認めず あすにも保釈の可能性
NHK 2018年12月20日 16時35分 ゴーン前会長 逮捕
2018年12月21日 17時21分ゴーン前会長 海外反応
Ghosn’s detention puts Japan justice system under microscope
December 23, 2018 (Mainichi Japan)
TOKYO (AP) — Since his arrest on suspicion of falsifying financial reports, Nissan’s former Chairman Carlos Ghosn has been sitting in a humble cell for more than a month, interrogated day in and day out, without a lawyer present.
His case is drawing attention to the criminal justice system in Japan, where there is no presumption of innocence and the accused can be held for months before trial. The system, sometimes called “hostage justice,” has come under fire from human rights advocates.
When a court denied Tokyo prosecutors’ request to detain Ghosn another 10 days on Dec. 20, it was so unusual that the Japanese media reported he might be released. But such speculation was dashed when prosecutors rearrested him a day later on suspicion of breach of trust, tagging on a new set of allegations centered on Ghosn’s shifting personal investment losses of some 1.8 billion yen ($16 million) to Nissan Motor Co. On Sunday, a court approved prosecutors’ request to detain him through Jan. 1.
But his plight is routine in Japan. People have signed confessions, even to killings they never committed, just to get out of the ordeal.
A trial could be months away and could drag on even longer. And his chances aren’t good: The conviction rate in Japan is 99 percent.
Those close to Ghosn and his family say he is asserting his innocence. But it is unclear when release may come for Ghosn, who led a two-decade turnaround at Nissan from near-bankruptcy. Tokyo prosecutors consider Ghosn, a Brazilian-born Frenchman of Lebanese ancestry, a flight risk.
Other nations may have legal systems that are criticized as brutal and unfair. The U.S., for instance, has its share of erroneous convictions, police brutality and dubious plea bargains. But, in the U.S., a person is presumed innocent, has the right to have an attorney present and gets freed within 72 hours if there is no charge.
Carl Tobias, a professor at the University of Richmond’s School of Law, said such a longtime detention is highly unusual in the U.S.
“Each time the government reaches a deadline where Ghosn might be released, the government files new allegations and rearrests,” he said.
Deputy Chief Prosecutor Shin Kukimoto said prosecutors are merely doing their job of “trying to carry out a proper investigation.”
When asked by a reporter about “hostage justice,” he replied: “We are not in a position to comment on how the law has been designed.”
Under such a system, those who insist on innocence end up getting detained longer. Once the rearrest processes run out and a suspect is formally charged, bail is technically possible but often denied until the trial starts because of fears about tampered evidence.
“It is good that the world will learn how wrong Japan’s criminal system is through the case of this famous person. It is something even many Japanese don’t know,” says Seiho Cho, a lawyer in Tokyo and an expert on criminal defense. “Countless people have gone through horrible experiences.”
A famous case is Iwao Hakamada, a professional boxer, who served 48 years in prison, mostly on death row after he signed a confession under questioning and was convicted of killing a family of four. He was freed in 2014 after DNA tests determined blood at the crime scene wasn’t Hakamada’s, and a court ruled police had likely planted evidence. Boxing champions had rallied on his behalf.
A true-life story of a man who refused to sign a confession that he groped a woman on a crowded commuter train became a popular 2007 movie “I Just Didn’t Do It,” directed by Masayuki Suo. The film depicts a five-year legal battle for exoneration, highlighting the burden of proof of innocence was on the accused.
In the U.S., defense lawyers tend to be vocal, but in Japan, it is fairly standard — as in the case of Ghosn — for them to stay silent, especially before trial, because that’s considered better for the suspects. Lawyers are allowed to visit clients in detention.
Ghosn has been formally charged in the initial set of allegations, underreporting his income by about 5 billion yen ($44 million) for five years through 2015. The maximum penalty for violating Japan’s financial laws is 10 years in prison, a 10 million yen ($89,000) fine, or both.
Greg Kelly, an American Nissan executive who was arrested with Ghosn, has been similarly charged with collaborating on underreporting Ghosn’s income. Kelly was not rearrested on the latest breach of trust allegations. Kelly’s U.S. lawyer says he is innocent and abided by company policy.
Nissan has also been charged as a legal entity, but no person besides Ghosn and Kelly has been charged or arrested. Nissan executives repeatedly say an internal investigation that began in the summer showed clear and serious wrongdoing, which went unnoticed for so long because of complex schemes “masterminded” by Ghosn and Kelly.
They went to the prosecutors, resulting in the surprise Nov. 19 arrests, and are cooperating closely with the investigation.
Being accused of a crime is devastating in a conformist insular society like Japan. Family members also become targets of discrimination, spurned for marriage and ostracized. Some commit suicide.
Cho, the lawyer, said the long detention and trial mean people lose their jobs, reputation, sometimes their families. But he still had this advice: Whatever you do, don’t confess to anything you didn’t do as that just makes it worse.
“Don’t ever compromise on your innocence,” he said.
Nissan CEO calls for Renault board to review Ghosn findings
January 15, 2019 at 09:15 JST
PARIS–Nissan expects alliance partner Renault’s board to back its ousting of Chairman Carlos Ghosn once it sees evidence from the Japanese carmaker’s investigation, Chief Executive Hiroto Saikawa said in a Monday newspaper interview.
Nissan understands that findings it provided to Renault lawyers more than a month ago have still not been shared in full with the Renault board, Saikawa told France’s Les Echos.
“All that I ask is that the directors of Renault should have access to the full dossier,” Saikawa said. “I think that once that’s the case, they will draw the same conclusions as we did.”
Ghosn’s November arrest in Japan and dismissal by Nissan have deepened tensions with its French parent Renault–which has so far maintained Ghosn in office as chairman and CEO, citing the presumption of innocence.
A spokesman for Renault, which has said judicial confidentiality requires tight restrictions on access to Nissan’s findings even by its own board members, did not return calls and messages seeking comment.
Ghosn has been charged over allegations that he failed to disclose close to $80 million in additional compensation for 2010-18 that he had arranged to be paid later. Nissan director Greg Kelly and the company itself have also been indicted.
Both men deny that the deferred pay agreements were illegal or required disclosure, while former alliance boss Ghosn has denied a separate breach of trust charge over personal investment losses he temporarily transferred to Nissan in 2008.
Saikawa’s interview was published ahead of an expected court hearing in Japan on Tuesday, at which Ghosn’s lawyers are to present a request for his release on bail.
The French government, Renault’s biggest shareholder, will support the decision to keep Ghosn at its helm unless it becomes clear he will be “chronically incapacitated” by the Japanese investigation, officials said on Monday.
Tuesday is likely to see “important developments” in relation to that question, one French official said.
Saikawa extended an olive branch to Renault and its state shareholder, while also dismissing French speculation that the scandal had been engineered by Nissan to oust Ghosn and end Renault’s control.
“It’s absurd and I don’t understand how anyone can believe such a scenario for a second,” he said. “Look at the evidence; it’s serious.”
While the presumption of innocence must be observed in criminal matters, Saikawa added, the Nissan board’s unanimous decision to dismiss Ghosn was grounded in ethical considerations and “the facts brought to light”.
Renault owns 43.4 percent of Nissan, whose reciprocal 15 percent holding in the French carmaker carries no voting rights.
Saikawa also appeared to soften his own earlier calls for changes to guarantee Nissan more autonomy and potentially restore its voting rights–which had rung alarm bells in Paris.
While investors do want to see the alliance structure evolve, Saikawa said, “that is really not the current priority.”
“The important thing today is to stabilise things and work together trustingly–not to know whether Nissan should have voting rights in Renault,” he added in the interview.
Former Nissan chief Carlos Ghosn suffering ‘draconian’ treatment in jail, wife says
Carole Ghosn says he’s being interrogated for hours each day to extract a confession
Mon 14 Jan 2019
The wife of the former Nissan chairman Carlos Ghosn has urged human rights campaigners to highlight Japanese prosecutors’ “draconian” treatment of her husband during his prolonged detention on charges of financial misconduct.
In a nine-page letter to the Japan office of Human Rights Watch, Carole Ghosn alleged that prosecutors have subjected her husband to hours of daily interrogation in order to extract a confession.
The letter also claims that Ghosn, who was briefly taken ill with a fever last week, is being held in an unheated cell that is lit even at night and is being denied his daily medication.
Ghosn, who has been in detention since his arrest on 19 November, faces two charges of under-reporting his salary by tens of millions of dollars, apparently to avoid criticism from Nissan employees that he was paid too much. A third charge alleges that he transferred personal investment losses to Nissan and used company funds to make payments to a Saudi business associate.
In his first appearance since his arrest, Ghosn last week proclaimed his innocence during a special court session, claiming that he had been “wrongly accused” and “unfairly detained”.
His lengthy detention has sparked international criticism of Japan’s “hostage justice” system, which permits prosecutors to re-arrest suspects over separate allegations and keep them in detention for long periods with the aim of extracting a confession.
More than 99% of criminal cases in Japan end in a conviction, with most secured through confessions.
“In Japan, suspects are routinely and repeatedly interrogated by prosecutors outside the presence of their lawyers; have no possibility for bail until after they have been indicted; have limited access to counsel; and are forced to sit and listen to interrogations even when they choose to exercise their right to remain silent,” Carole Ghosn said in her letter.
“My husband’s treatment is a case study in the realities of this draconian system. For hours each day, the prosecutors interrogate him, browbeat him, lecture him and berate him, outside the presence of his attorneys, in an effort to extract a confession.”
Ghosn’s head lawyer, Motonari Otsuru, last week denied that his client was being pressured to sign a confession, adding that he had not complained to his legal team about conditions at the Tokyo detention centre. Otsuru said Ghosn, who was initially kept in a tiny cell with a futon, had been moved to a bigger cell with a bed.
Ghosn has so far been denied visits from his family during his detention, with only his lawyers and embassy officials granted permission to meet him.
He is being held in a 7 sq m (75 sq feet), unheated cell, according to Carole Ghosn, eats mainly rice and barley-based meals and has lost 7 kg (15 lb) over the past two weeks. He is allowed to exercise for 30 minutes and to take two or three baths a week, she added.
Ghosn’s lawyers have conceded that he is likely to remain in detention until his trial begins, mainly because he maintains his innocence and is considered a flight risk. No trial date has been set, and it could be at least six months before his case comes to court.
Why Ghosn’s Still Jailed and What It Says About Japan: QuickTake
By Lisa Du and Kaye Wiggins
January 11, 2019, 5:44
Updated on January 14, 2019,
Carlos Ghosn, the deposed chairman of Nissan Motor Co., was until recently a jet-setting captain of industry. To the shock of many, he was arrested in Japan on Nov. 19 and has been detained ever since in a murky case involving his personal finances, with no release date in sight. Ghosn’s alleged conduct is not the only thing under scrutiny. So is Japan’s highly efficient legal system and its near-perfect conviction rate.
1. What is Ghosn charged with?
Filing false statements to regulators regarding income from Nissan deferred until retirement – a total $80 million. Starting in 2009, when Japan required companies to make executive compensation public, Ghosn’s reported pay was roughly half what he had been making before, but his deferred pay ballooned, said people familiar with the probe. Japanese law requires remuneration to be reported in the year it’s fixed, even if the payout happens later, according to Kyodo News. Ghosn’s pay was an image problem in Japan and he had been called out on it before. He’s also been charged with aggravated breach of trust for acts including temporarily transferring personal investment losses to Nissan in 2008. Both charges carry a potential maximum sentence of 10 years in prison and a fine of up to 10 million yen ($92,000).
2. What does Ghosn say?
In court the 64-year-old said the agreements for deferred pay were non-binding “draft proposals” so didn’t need to be disclosed. His lawyer has said Ghosn never signed the agreements. Regarding the trading losses, Ghosn said Nissan took on two foreign-exchange swap contracts temporarily, with board approval, and transferred them back without incurring a loss. His lawyers have said regulators looked into the case and didn’t file criminal charges.
3. Why’s he still locked up?
That’s not unusual in Japan, where suspects routinely endure lengthy pre-trial detentions and repeated grillings by prosecutors without a lawyer present. Suspects are often re-arrested on suspicion of new charges periodically to keep them in custody while prosecutors attempt to build a case. Bail is the exception more than the rule. Legal experts say this is all a strategy to secure a confession and make a trial easier. In Ghosn’s case, the judge at a Jan. 8 hearing said his continued detention was due to flight risk and the risk of witness or evidence tampering. Ghosn holds French, Lebanese and Brazilian passports and his children live in the U.S.
4. What are his prospects?
More time locked up. An indictment is a sign that prosecutors intend to go to trial, which Ghosn’s chief lawyer, Motonari Otsuru, has said could be six months away. Prosecutors have wide discretion in Japan to decide whether to go to trial, and tight budgets and a culture of wanting to save face mean they usually only pursue those they are sure to win. In 2015, a trial was requested for 7.8 percent of cases overseen by the public prosecutor’s office. That helps explain why more than 99 percent of cases that go to trial end with a conviction. In England and Wales, the conviction rate is 87 percent.
5. Has Ghosn been mistreated?
Ghosn’s wife Carole has criticized what she called his “harsh treatment” in prison and said he’d lost 15 pounds (7 kilos) since his arrest. She’s said the family hasn’t been allowed to contact him, and that he undergoes hours of questioning daily with only limited opportunities to confer with his legal team. Two of Ghosn’s daughters told the New York Times in late December that his cell was unheated, that he had asked repeatedly for blankets and that he had been denied pen and paper. Two days after he appeared in court Jan. 8 looking gaunt, he was being treated by a doctor for a fever that soon subsided. Otsuru said Ghosn had been moved to a larger room than when he was first incarcerated, with a Western-style bed, toilet and wash basin. Lebanon’s ambassador to Japan, who has visited Ghosn in the Tokyo detention center, was said to have brought him a mattress.
6. What’s the verdict on Japan’s legal system?
Critics say lengthy detentions and interrogations with limited access to an attorney can lead to false confessions, such as the recent case of a woman released after 20 years in jail. The UN Committee Against Torture has expressed concerns. Amnesty International said in 2017 that it had “raised concerns about the lack of rules or regulations regarding interrogations” during pre-trial detentions. The Japan Federation of Bar Associations has called for reforms including recording of interrogations. The Japanese government responded by noting its system requires “strict judicial reviews at each stage” to balance the human rights of suspects with the needs of investigators.
7. Is anyone else investigating Ghosn?
Nissan says it’s conducting an internal investigation into “substantial and convincing evidence of misconduct” and accused Ghosn of misusing company funds – including in the purchase of homes in Brazil and Lebanon and hiring his sister on an advisory contract. Those allegations aren’t part of the criminal case but could be added. Nissan says its internal probe – sparked by a whistleblower – continues to broaden.
8. Who else has been charged?
Nissan has been indicted for under-reporting Ghosn’s income and faces around $6 million in potential fines if convicted. The auto company said it would strengthen its corporate governance and compliance and file amended financial statements once it has finalized the corrections. Former Nissan executive Greg Kelly – known as Ghosn’s gatekeeper and confidante – was indicted for allegedly helping him under-report income but was released on bail Dec. 25. Kelly has denied the allegations through a lawyer. Meanwhile, Japan’s securities commission has asked prosecutors to indict the company, Ghosn and Kelly with additional charges.
9. How are others interpreting events?
Renault SA has retained Ghosn as chairman and chief executive officer, saying it needs evidence of his wrongdoing. Renault’s almost 20-year partnership with Nissan had become strained and Nissan CEO Hiroto Saikawa had striven to re-balance what he and others at the Japanese company viewed as an increasingly lopsided relationship. Ghosn had been pushing for an outright merger, which Saikawa and others opposed. Saikawa’s quick move to oust Ghosn as Nissan chairman three days after the arrest and denunciations of his alleged misdeeds fueled conspiracy theories about a palace coup. Nissan spokesman Nicholas Maxfield told the Times such claims were baseless. “The cause of this chain of events is the misconduct led by Ghosn and Kelly,” he said.
The Reference Shelf
Japan’s Supreme Court outlines the criminal justice system.
“I am innocent.” A statement by Carlos Ghosn.
France starts to shift position on Ghosn, says Bloomberg Opinion’s Lionel Laurent.
Bloomberg Opinion’s Joe Nocera says Nissan and Japanese prosecutors may come out of this looking a lot worse than Ghosn.
Nissan CEO turns on mentor out of “despair.”
A legal essay in the Japan Times about what Ghosn’s arrest says.
An archived Ministry of Justice document shows the Tokyo detention house (the document’s no longer displayed on the MOJ website).
Some photos of the prison festival on the Japan Visitor website.
An MOJ document in Japanese about the country’s correctional facilities.
— With assistance by Isabel Reynolds
Nissan-Renault alliance sinks deeper into disarray without Ghosn
Overconcentration of power threatens two decades of international cooperation
January 14, 2019 13:00 JST
TOKYO — The alliance between Nissan Motor and Renault, once touted as a rare successful international business tie-up, has slipped further into confusion since Carlos Ghosn was arrested nearly two months ago.
The Japanese and French automakers have carried out many joint activities, including new-vehicle development and parts and materials procurement. But now, the bill for depending on Ghosn as absolute leader has come due.
Nissan President and CEO Hiroto Saikawa has often stayed in his office on the 21st floor of the company’s headquarters in Yokohama until late into the night since Ghosn’s arrest, discussing the case with lawyers and meditating on it alone.
Saikawa was informed of Ghosn’s alleged financial misconduct only a month before the arrest. While the arrest sent shock waves across the world, Saikawa was also caught off guard.
Saikawa climbed to the top at Nissan by carrying out tasks successively assigned to him by Ghosn. Now, with no one giving him instructions, he has yet to provide a sense of direction for the automaker.
The origin of the absolute leader traces back 20 years.
In 1999, then-Renault Chairman Louis Schweitzer told Ghosn just before concluding a tie-up agreement to bail out Nissan that he would not sign the deal if the Brazilian-born executive refused to go to Japan. Ghosn had made his name as a cost-cutter.
DaimlerChrysler also came out in support of Nissan, with a possibility of acquiring a majority stake. Renault was apparently desperate, as Schweitzer had promised then-Nissan President Yoshikazu Hanawa that the French automaker would hold its stake down to 36.8%. Nissan could maintain its identity as a Japanese manufacturer through its tie-up with Renault, he told Hanawa.
The fate of Nissan-Renault then rested in the hands of one man rather than the workings of the capital tie-up.
In 2002, the French company raised its stake in Nissan to 44.4%. This was lowered to 43.4% in 2010, while the Japanese company took a 15% interest in Renault.
Hanawa asked Ghosn to come to Japan “not as a Renault man, but as a Nissan man.” Ghosn quit Renault and joined Nissan. After discussions with many employees, he worked out the Nissan Revival Plan and stressed that solutions to the company’s woes could be found on the factory floor. The plan enabled Nissan to stage a sharp rebound.
Ghosn concurrently took the post of CEO at Renault in 2005. With the retreat of Hanawa and other Nissan executives, including co-Chairman Itaru Koeda, from the vanguard, Ghosn’s hand was strengthened.
In July 2006, Ghosn announced the launch of tie-up negotiations between the Nissan-Renault alliance and American carmaker General Motors. Asked by a reporter whether he wanted to create the world’s largest automaker and become its CEO, Ghosn denied that the decision to start the talks was his alone. But Nissan’s boards gave him full powers.
While the negotiations fell apart, Nissan and Renault integrated production, procurement and certain other operations in 2014. In 2016, the alliance invested in Mitsubishi Motors, setting an eye toward becoming the world’s biggest automobile group, with annual sales of 10 million vehicles.
With Ghosn having the final say on decisions by the tripartite alliance, project managers were reportedly required to report progress to him.
Ghosn has evidently changed since 2010, after the global financial crisis triggered by the collapse of Lehman Brothers, many senior Nissan executives said.
Under his leadership, Nissan released the world’s first all-electric car for the mass market, the Leaf, in 2010. But combined sales by Nissan and Renault totaled only 70,000 units three years after the Leaf’s debut, despite the alliance’s target of boosting them to 1.5 million units in six years.
Ghosn put right-hand man Toshiyuki Shiga, then chief operating officer, in charge of shoring up sales of the Leaf. But in November 2013, seven months after the appointment, Ghosn relieved Shiga of the COO post.
Nissan then revised its earnings projections downward for a second consecutive year, partly on unsuccessful business strategies in the North American market. Ghosn put his once-lauded “commitment management” aside and replaced veteran Japanese executives en masse.
With the 2010s starting, Nissan shifted its management priority from reconstruction to growth. In line with this, the Nissan-Renault alliance acquired AvtoVAZ, the biggest automaker in Russia, at the request of Russian President Vladimir Putin. It also started tie-up talks with Ford Motor of the U.S. on fuel cell vehicles.
But as Ghosn discharged close aides, operations suffered. With pressure to produce results growing, he replaced one senior executive after another and further tightened his grip.
Ghosn has built the Nissan-Renault alliance into a machine that cannot function without him. The logical endpoint would be “management integration of Nissan and Renault,” an executive at the Japanese automaker said.
Ghosn reportedly formed a “private team” of major American bankers and others to quietly work out an integration scenario. At a Nissan board meeting last September, he said only that he would like to advance the alliance.
But a veteran Japanese executive feared that Ghosn would advance his plan for management integration on his next visit to Japan, warning that Nissan would be absorbed by Renault unless it took countermeasures.
Suspicions grew stronger last spring of Ghosn having designs on Nissan. A top-secret team set up by Nissan began working to topple him in cooperation with the special investigation squad of the Tokyo District Public Prosecutor’s Office. On Nov. 19, prosecutors arrested Ghosn upon his arrival at Tokyo’s Haneda Airport.
After relying on Ghosn for so long, Nissan has seen its management distorted in ways not easily corrected.
With an automobile using some 30,000 parts, a carmaker plans and develops a model with an eye on five years down the road. Renault, Nissan and Mitsubishi have a total of nearly 100 models. While a huge number of projects are always underway, Ghosn’s iron-fisted rule made it possible to balance demands by the three partners and make the best choices for the alliance as a whole.
Cracks have emerged in Nissan’s top ranks. Chief Performance Officer Jose Munoz has resigned, and Arun Bajaj, senior vice president in charge of global human resources, has taken a leave of absence.
As the Ghosn case involves such complications as Japanese- and English-language documents as well as cross-border transactions, “more than half a year may be needed before the first trial hearing,” said Motonari Otsuru, head of Ghosn’s Japan-based legal team.
During a court hearing held on Jan. 8, the former Nissan chief expressed his readiness to continue fighting in court. Ghosn said he looked forward “to beginning the process of defending myself” and declared himself “innocent of the accusations made against me,” according to the text of his statement.
If Ghosn is released on bail, he may launch a counterattack on Nissan’s management.
Neither Nissan nor Renault seems to have anyone capable of putting the alliance back on track.
The Japanese automaker was supposed to hold top-level talks with Daimler in late November to discuss plans for a Mexican joint-venture factory that has suffered from falling demand for large vehicles in the U.S. and uncertainty over the future of the North American Free Trade Agreement. Months after Ghosn’s arrest, the companies have yet to reschedule.
Nissan directors decided at a Jan. 10 board meeting to expand the scope of decisions requiring their approval. The company has already set up a committee, made up largely of outsiders, to overhaul decision-making in appointments and compensation to prevent the rise of another charismatic leader with outsize influence like Ghosn.
The 20-year-old alliance will quietly collapse if it cannot find a way out of its predicament.
2019年1月15日 10時7分 読売新聞
Ex-Nissan chairman Ghosn asks for bail, promises not to flee
THE ASSOCIATED PRESS
January 21, 2019 at 08:50 JST
Former Nissan chairman Carlos Ghosn on Monday asked for his release on bail from a two-month detention in Japan, promising he will report to prosecutors daily and wear an electronic monitoring ankle bracelet.
“As the court considers my bail application, I want to emphasize that I will reside in Japan and respect any and all bail conditions the court concludes are warranted,” he said in a statement shared with The Associated Press through a representative of Ghosn and his family.
“I am not guilty of the charges against me and I look forward to defending my reputation in the courtroom; nothing is more important to me or to my family,” he said.
Ghosn, 64, and in custody since his Nov. 19 arrest, is due for a bail hearing Monday after his bail request was denied by a Tokyo court last week.
His latest request includes a lease for a Tokyo apartment, where he promises to live. The offer to wear a monitoring device is not standard for Japanese bail but is often included in U.S. bail conditions. No trial date has been set.
In Japan, suspects are often kept in detention until trials start, especially those who assert innocence, in what’s criticized as “hostage justice.” Tokyo prosecutors say Ghosn is a flight risk and may tamper with evidence. Legal experts, including Ghosn’s lawyers, say preparations for trials as complex as Ghosn’s take six months or longer.
Ghosn is also promising to give up his passport and hire security guards acceptable to prosecutors that he would pay for.
He has been charged with falsifying financial reports in underreporting his compensation from Nissan Motor Co., and breach of trust in having Nissan shoulder investment losses and pay a Saudi businessman.
Ghosn has asserted his innocence, saying the compensation was never decided, Nissan never suffered losses and the payments were for legitimate services for Nissan’s business in the Gulf.
He has been held in austere conditions at the Tokyo Detention Center, allowed visits only by embassy officials, lawyers and prosecutors. His wife, Carole Ghosn, has expressed worries about his health and appealed to Human Rights Watch about what she saw as his unfair and harsh treatment.
Ghosn led Nissan for two decades, turning it around from near-bankruptcy to one of the world’s biggest and most successful auto groups. A Brazilian-born Frenchman of Lebanese ancestry, with work experience in the U.S., Ghosn was admired internationally for his managerial skills. He was sent in 1999 by Renault SA of France, which owns 43 percent of Nissan.
Nissan Chief Executive Hiroto Saikawa has denounced Ghosn, accusing him of using company money and assets for personal gain. But Nissan’s oversight has raised serious questions about governance at the automaker behind the Leaf electric car and Infiniti luxury models.
Nissan’s internal investigation found Nissan purchased homes and furnishings for Ghosn in Lebanon and Brazil, but only a handful of people at Nissan knew, according to people familiar with the probe. Nissan still owns the homes.
The latest development in the investigation was discussed by the board of Nissan’s Japanese alliance partner Mitsubishi Motors Corp. last week, centering on millions of dollars of salary and bonus pay to Ghosn by the automakers’ joint venture in Amsterdam last year, which neither Mitsubishi nor Nissan knew about.
No charges have been filed on these payments, which are separate from the compensation from Nissan cited in the charges already filed.
Ghosn’s compensation was long a sticking point in Japan, where the income difference between executives and workers is so minimal that company presidents are also called “salarymen.” Ghosn has said he deserved pay comparable to other star leaders of global companies.
Ghosn defended his record at Nissan at a Tokyo court earlier this month.
“I have a genuine love and appreciation for Nissan. I believe strongly that in all of my efforts on behalf of the company, I have acted honorably, legally, and with the knowledge and approval of the appropriate executives inside the company,” he said.
Ghosn Jail Time Is `Too Long, Too Hard,’ Macron Tells Japan
Gregory Viscusi, Bloomberg, 2019/1/27
French President Emmanuel Macron told Japanese Prime Minister Shinzo Abe that he’s worried about Carlos Ghosn’s conditions in jail, making his strongest comments yet on the fallen car titan and the scandal that has rocked Renault SA’s decades-old alliance with Nissan Motor Co.
“All I’ll say is that I felt the detention was too long and too hard, and I told Abe that,” Macron told reporters in Cairo, referring to a telephone conversation with Abe on Friday. “I’m just concerned that the case of a French citizen should respect basic decency.”
Macron’s views follow days after Ghosn stepped down as chairman and chief executive officer of France’s largest carmaker and two months after Nissan booted him out, with the attention shifting to the future of the partnership. While Renault named Michelin CEO Jean-Dominique Senard as its chairman last week, the French leader has reportedly suggested the executive be made Nissan’s chairman as well to help manage the alliance.
With his public remarks on the case, Macron risks being seen as meddling in Japan’s justice system. Japan’s Chief Cabinet Secretary Yoshihide Suga told reporters Monday that due process is being followed in Ghosn’s detention and investigation.
“It is being carried out by highly independent investigative authorities, based on appropriate procedures and strict legal judgment, including the orders of the court,” Suga said. He also said the two carmakers should decide on who becomes Nissan’s chairman, pushing back on the idea of governments getting involved in the talks.
Ghosn has been in custody since his Nov. 19 arrest in Tokyo, indicted for allegedly understating his income at Nissan and transferring personal trading losses to the carmaker. He’s been denied bail repeatedly after prosecutors argued he’s a flight risk, while his lawyers say he could stay in custody until a trial that may be six months away. Ghosn has denied wrongdoing.
Macron’s involvement in the affairs of the two companies is mainly because of the power the French state wields over Renault. The government owns 15 percent of Renault with extra voting rights, while the latter holds about 43 percent of Nissan with voting rights, giving French leaders indirect say in decisions that sometimes affect the Japanese carmaker.
Nissan has a 15 percent non-voting stake in Renault, which also appointed Thierry Bollore as its CEO.
While both companies have repeatedly said they are committed to the partnership, Nissan has long been unhappy about what it considers an out-sized French role in the alliance, whose third member is Mitsubishi Motors Corp.
“We will be diligent to ensure the stability of the group,” Macron said.
Renault-Nissan alliance executives will meet this week in Amsterdam, where the company that manages the partnership is based, people familiar with the matter said. The meeting would be the first since Ghosn quit.
In an unexpected twist, Nissan CEO Hiroto Saikawa, a former protege of Ghosn who led the campaign against his ex-boss, said he too intends to step down in coming months after reforming the poor governance he says weakened the Japanese carmaker. Nissan has also been indicted by prosecutors.
Macron also has a history with Renault. On Sunday, he defended an increase in the French stake in 2015 on his watch as economy minister. It was a move that had rattled Nissan.
“I was happy I intervened, because I felt that Ghosn had gone too far in the ‘Nipponization’ of the group,” he said.