Renault-Nissan Boss Arrested for Financial Violations

Nissan Motor Co. Chairman Carlos Ghosn has been arrested over suspected financial violations, the NHK reported, and the carmaker said it will seek a removal of the industry icon as its chairman after an investigation into his alleged misconduct.

Ghosn, among the most prominent auto-industry leaders globally and also the CEO of Renault SA, was detained over a suspected breach of Japanese financial law, NHK reported.

Based on a whistleblower tip, Nissan has been doing an internal investigation over the past several months into suspected financial misconduct involving Ghosn and director Greg Kelly, the company said Monday. Nissan seeks to remove both Ghosn and Kelly, Bloomberg reported.

 “The investigation showed that over many years both Ghosn and Kelly have been reporting compensation amounts in the Tokyo Stock Exchange securities report that were less than the actual amount, in order to reduce the disclosed amount of Carlos Ghosn’s compensation,” Nissan said. “Also, in regards to Ghosn, numerous other significant acts of misconduct have been uncovered, such as personal use of company assets, and Kelly’s deep involvement has also been confirmed.”

Nissan said it has been providing information to the Japanese prosecutors and is cooperating fully with their investigation. Ghosn voluntarily went with Tokyo prosecutors, Asahi reported.

A spokesman for Renault declined to comment. Shares of the French carmaker fell as much as 15% in Paris, while Nissan global depository receipts sank more than 11%.