Nissan Faces S.E.C. Inquiry
The United States Securities and Exchange Commission has requested information from Japanese carmaker Nissan Motor amidst the scrutiny of its former chairman Carlos Ghosn’s financial misconduct accusations. The SEC is investigating the verity of Nissan’s executive pay disclosures. A spokesperson for Nissan said that the company “[has] received an inquiry … and [is] cooperating fully.”
Being a listed company in Japan, Nissan issues American Depositary Receipts, which trade in the US over-the-counter market, allowing US investors to buy Nissan’s shares indirectly. An investigation from the SEC could lead to a fine, causing more financial troubles for Nissan during an already troubling time.
Mr. Ghosn has been accused of underreporting his compensation. Now, Japanese authorities are investigating the deferred compensation that Mr. Ghosn was supposed to receive after retirement, which totals over $80 million from the fiscal years between 2010 and 2017. In 2010, Japan implemented a new regulation, which requires companies to disclose the salaries of executives earning more than 100 million yen, or $915,000. Mr. Ghosn has also been accused of transferring his financial losses to Nissan’s books while acting as the company’s chairman.
One of the most celebrated executives in the auto industry, Mr. Ghosn has contributed to the successes of Nissan, French automaker Renault, and Mitsubishi Motors, creating an alliance between the three. Since his arrest on November 19, however, he has been removed as chairman of all three companies and has been in jail in Tokyo since.
All three alliance members have moved to distance themselves from Mr. Ghosn’s wrongdoings. Nissan and Mitsubishi have come together to accuse the former chairman of pocketing nearly $9 millions from the two automakers’ joint venture in the Netherlands. The French government, which owns 15 percent of Renault, has called for new management. Renault has appointed Thierry Bolloré as chief executive and Jean-Dominique Senard as chairman, with a brief to manage the company’s alliance with Nissan. Both carmakers’ executives have expressed interests in maintaining the relationship.