Ghosn, a towering figure in the industry who saved Nissan from collapse and brought it together with Renault SA and Mitsubishi Motors Corp., was detained Monday in Tokyo over a suspected breach of Japanese financial laws, according to NHK. The companies have worked as an alliance for nearly a two decades and Brazilian-born Mr Ghosn has led a dramatic turnaround at Nissan over the last two decades, rescuing it from near-bankruptcy.
The Yomiuri newspaper reported that Ghosn had been arrested by Tokyo prosecutors on suspicion of under-reporting his salary. The alleged violations relate to.
Carlos Ghosn, the powerful head of Renault, Nissan and Mitsubishi, faces arrest in Japan after being accused of tax evasion and misconduct. The country owns around 15 percent of Renault, Nissan's partner, and supported Ghosn's renewal at the helm of the French automaker.
Following an internal investigation conducted after a whistle-blower claimed that he under-reported salary, Nissan to remove Ghosn from position. Ghosn remained in that post till past year.
The allegations are a serious blow at a time when Nissan and another alliance member, Mitsubishi Motor Co., are still overcoming scandals over their quality testing reporting.
In a statement, Nissan said: "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 Ghosn's compensation".
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Nissan's Carlos Ghosn, one of the auto industry's star executives, now faces dismissal by the Japanese vehicle maker, and has been arrested.
A spokesman for France's finance ministry declined to comment on the news.
At Nissan, he was paid about 1.1 billion yen ($10 million) for 2016 and about $6.5 million in the most recent fiscal year.
An ouster of Ghosn, 64, is bound to raise questions about the future of the alliance that he personally shaped and had pledged to consolidate with a deeper tie-up, before eventually stepping back from its operational leadership. "We will continue our work to identify our governance and compliance issues, and to take appropriate measures".
Ghosn began his career at Michelin in France, moving on to Renault. Nissan found itself in the midst of a controversy past year, when Japan's regulators discovered uncertified inspectors were approving vehicles, leading to a recall of more than 1.2 million cars.