Japanese prosecutors accused former Nissan executive Greg Kelly of joining a “conspiracy” to pay his former boss Carlos Ghosn illicitly, as they wrapped up their closing arguments in a yearlong trial.
That unpaid compensation existed is clear,” prosecutor Yukio Kawasaki told the Tokyo District Court on Wednesday.
Kelly, a 30-year veteran at the Japanese automaker, had been living in the US when he was arrested in November 2018 when he returned to Japan to attend a meeting.
The first American to be appointed to Nissan’s board, Kelly says he is innocent. He sat calmly in the courtroom, wearing his usual red tie and dark suit, alongside defence lawyers.
Kelly told The Associated Press in an interview last month he did not know all the details of Ghosn’s pay, but was determined to retain Ghosn, Nissan’s former chairman, because of his extraordinary management skills.
Ghosn was arrested at the same time as Kelly and also maintains he is innocent. He skipped bail in late 2019 and fled to Lebanon, the country of his ancestry. It has no extradition treaty with Japan.
The charges centre around a pay cut of about 1 billion yen (£6.5 million) a year that Ghosn voluntarily started taking from 2010, halving his pay after disclosure of high executive pay became mandatory in Japan.
Neither side is contesting that cut. The contention is over whether that money should have been reported as compensation as a de facto promised sum under a binding contract, or did not need to be disclosed until it was finalised.
Nissan officials considered various ways to make up for the money Ghosn gave up, such as paying him consulting fees after retirement.
They also mulled other methods such as payments through subsidiaries and stock options. Nothing had been paid at the time of the arrests.
Ghosn has said a group at Nissan engineered his arrest because they feared that French automaker Renault, which owns 43% of Nissan, would gain more control over the company. Other Nissan officials made similar comments during Kelly’s trial.
Renault sent Ghosn to Nissan in 1999 to lead its rescue from the brink of bankruptcy. He successfully steered the maker of the Leaf electric car and Infiniti luxury models for nearly two decades.
Ghosn has also been charged with breach of trust allegations centred around using Nissan money for personal gain, ranging from housing, tuition payments for his children, use of a corporate jet and purchases such as a chandelier. Ghosn has said they were needed for work.
Yokohama-based Nissan, as a company and legal entity, has also been charged, and has pleaded guilty.
If convicted of violating the Financial Instrument and Exchange Act, Kelly could face up to 15 years in prison. The verdict from a panel of three judges is not expected until March next year.