Former Nissan chairman Carlos Ghosn has been formally charged in relation to the alleged misreporting of his pay package over a seven-year period.
Authorities in Japan have re-arrested Ghosn and representative director Greg Kelly in order to prolong their time in jail following the indictment, which relates to charges which could result in prison sentences and fines of up to 10 years and almost £700,000, if found guilty.
Nissan, as a corporate entity, was also indicted for its alleged role in filing securities reports that understated Ghosn’s compensation. Companies can be fined up to £4.89m under the charges.
The manufacturer expressed its regret at the situation in a statement which confirmed its own indictment as well those against Ghosn and Kelly.
It said: “Making false disclosures in annual securities reports greatly harms the integrity of Nissan’s public disclosures in the securities markets, and the company expresses its deepest regret.
“Nissan will continue its efforts to strengthen its governance and compliance, including making accurate disclosures of corporate information.”
Nissan, Ghosn and Kelly stand accused of violating Japan’s Financial Instruments and Exchange Act by allegedly under-reporting Ghosn’s compensation by around £34.9m during the fiscal years between 2010 and 2014.
Ghosn and Kelly’s re-arrest today (December 10) relates to new allegations that they also under-reported a further £27.9m compensation in the fiscal years from 2015 to 2017.
Japanese news outlets have reported that Ghosn and Kelly could now remain in custody until December 30.
Ghosn’s legal team maintain that the charges against him are invalid because they do not relate to his salary, but to future payments that he was expected to receive after retirement, the BBC reported.