Sep 24, 2019 (Japan Today) - U.S. securities regulators on Monday charged Japanese automaker Nissan and its former CEO Carlos Ghosn with hiding more than $140 million in Ghosn's expected retirement income from investors.
Ghosn will pay $1 million in fines to settle the matter and will be barred from serving as a corporate executive for 10 years, the Securities and Exchange Commission said in a statement.
Nissan will pay a $15 million fine. The SEC also charged former board member Greg Kelly with aiding in the fraud. He agreed to a $100,000 fine and a five-year corporate officer ban.
But Ghosn, Kelly and Nissan neither admitted nor denied the SEC's allegations.
Attorneys for Ghosn on Monday welcomed the deal, saying it allowed him to focus on fighting similar allegations in Japan.
The SEC said Ghosn, 65, working with Kelly and other subordinates, devised ways to disguise large amounts of Ghosn's compensation.
The machinations allegedly stemmed from a shift in Japanese policy in 2009 that required disclosure of individual director compensation above 100 million yen, a little more than $1 million the time.
"Ghosn became concerned about criticism that might result in the Japanese and French media if his total compensation became publicly known," the SEC said.
Ghosn directed to subordinates to lobby the Japanese government to rescind the policy.
When that failed, "Ghosn and Nissan subordinates took steps to conceal from public disclosure a substantial portion of Ghosn's compensation," the SEC order said.
Ghosn and Kelly allegedly "fraudulently inflated" Ghosn's pension allowance by more than $50 million and created a "false disclosure" to disguise the increase, the SEC said in an order.
Subordinates to Ghosn falsely told the company's chief financial officer that another big set of payments under a long-term incentive plan went to many Nissan employees and not primarily to Ghosn.
Ghosn also instructed an employee to change the currency in which Ghosn's pension would be paid.
