TOKYO -- Japanese prosecutors on Monday indicted Carlos Ghosn for a fourth time, the latest charge alleging the fallen auto executive misappropriated some $5 million from Nissan for personal use during his time as head of the automaker.
The indictment follows his April 4 arrest. Ghosn has been jailed since then.
A spokesman for Ghosn said he is innocent of the "baseless accusations," and his lawyers filed a request for bail after the indictment.
The latest accusation escalates the legal jeopardy facing the ousted Nissan chairman as he awaits trial in Tokyo. The aggravated breach of trust indictment alleges Ghosn caused financial damage to Nissan by diverting $5 million to his pockets.
In their indictment, prosecutors said Ghosn pocketed $2.5 million in July 2017 and another $2.5 million in July 2018 by siphoning money through a third company “virtually owned by him.”
That money was originally paid by a wholly owned Nissan subsidiary to a Nissan overseas distributor and then sent to the third company, prosecutors allege.
In their April 4 arrest document, prosecutors said Ghosn arranged to have some $15 million transferred from the wholly owned Nissan subsidiary to a bank of an overseas sales representative from December 2015 through July 2018. Ghosn then received a portion of those funds for his personal use through a bank account of the third company.
Prosecutors said $5 million of the transfers was diverted back to Ghosn, and they allege the same amount of financial damage was incurred to Nissan.
Earlier Monday, Nissan said it filed a criminal complaint against Ghosn related to the alleged aggravated breach of trust. The statement submitted to prosecutors said the company believes it was harmed by Ghosn’s misconduct and called for penalties.
"Nissan filed the complaint after determining that payments made by Nissan to an overseas vehicle sales company via a subsidiary were in fact directed by Ghosn for his personal enrichment and were not necessary from a business standpoint," Nissan said. "Such misconduct is completely unacceptable, and Nissan is requesting appropriately strict penalties," the automaker said.
Ghosn had already been arrested on three previous charges, including one for breach of trust, and was awaiting trial on three indictments. He had spent 108 days in detention following his initial Nov. 19 arrest, but was released March 6 on a nearly $9 million bail.
Ghosn was free for less than a month before being jailed again on the latest charge.
Prosecutors arrested Ghosn over a payment to an Oman sales representative, some of which is suspected of being used to help pay for a yacht for his personal use and diverted into a U.S.-based investment firm run by his son, Japanese media reported.
Ghosn has denied any wrongdoing. In a statement released after his arrest, Ghosn vowed he "would not be broken" and called the latest arrest "outrageous and arbitrary."
In a video message released this month, Ghosn said he was the victim of a boardroom coup instigated by "backstabbing" Nissan executives concerned about his plans to merge Nissan with its French partner Renault, the Japanese company’s biggest shareholder.
"This is not about greed. This is not about dictatorship. This is about a plot. This is about conspiracy. This is about backstabbing," Ghosn said in the video, filmed before his April 4 arrest.
"There was first a fear that the next step of the alliance, in terms of convergence and in terms of moving toward a merger, would, in a certain way, threaten some people or eventually threaten the autonomy of Nissan," he said. “I'm talking about people who really played a very dirty game."
Speaking at a press conference after the indictment, Deputy Chief Prosecutor Shin Kukimoto declined to comment on whether the latest indictment concludes the prosecutor’s investigation or if additional charges might be coming. Nissan has said it continues to unearth other alleged financial misconduct, but Japanese media have reported that this fourth indictment is likely the last.
The latest indictment focuses on results of an internal Nissan investigation that found Ghosn approved payments of around $35 million from Nissan to a distributor in Oman from 2011 to 2018.
The disbursements went to Suhail Bahwan Automobiles, which is run by billionaire Suhail Bahwan, a friend of Ghosn's, according to someone familiar with the matter. The company distributes Nissan vehicles in the region.
Nissan's probe found evidence suggesting Suhail Bahwan Automobiles may have supported Ghosn's purchase of a yacht and helped finance a company owned by Ghosn's son.
Japanese media reports said that Ghosn paid Suhail Bahwan Automobiles out of his CEO Reserve, a special fund for ad hoc expenses. The disbursements were marked as marketing expenses, but prosecutors suspect they were channeled into personal use for such things as the purchase of a yacht and a 3 billion yen ($26.9 million) personal loan to Ghosn.
Renault has also reportedly alerted French prosecutors after uncovering suspect payments to a Renault-Nissan business partner in Oman while Ghosn was CEO of the French automaker.
Ghosn also faces three previously filed indictments, two for allegedly misreporting tens of millions of dollars in deferred compensation and a third concerning alleged breach of trust. He faces up to 15 years in prison if found guilty.
In the first two indictments, Ghosn is charged with falsifying company financial filings to hide some $80 million in deferred compensation.
Ghosn's breach of trust charge alleges that he temporarily shifted 1.85 billion yen ($16.5 million) in personal swap contract losses to Nissan and had Nissan pay $14.7 million out of the CEO Reserve to a business associate who allegedly helped Ghosn clear the red ink.