TOKYO — Carlos Ghosn's legal tribulations in Japan, where the CEO of Renault remains in jail, will make for a dramatic 2019 — for Ghosn, for Nissan and also for Renault.
Ghosn is scheduled to appear in court for a hearing this week in Tokyo, making his first public appearance in nearly two months. The ousted chairman of Nissan and Mitsubishi has been in jail without bail since Nov. 19, charged with financial improprieties.
But the strange Japanese drama will now heat up for all parties.
Ghosn faces mounting legal woes in Japan. Renault is in limbo, awaiting word on Ghosn's fate and wondering how to deal with Nissan. And Nissan is pushing sweeping post-Ghosn reforms that could further stress the strained alliance with Renault and Mitsubishi. The heads of the Japanese and French companies, mired in distrust and uncertainty, are barely talking about the massive rift that has opened between the carmakers.
A watershed event will likely be Ghosn's trial, expected as early as this year. A person familiar with his defense says Ghosn denies wrongdoing and plans to redeem his broken reputation from the stand. The trial is expected to focus on the first of his criminal charges — that he underreported $43.5 million in deferred compensation.
But on top of that indictment, Ghosn was additionally arrested on separate allegations that he shifted approximately $16.9 million in personal swap contract losses to Nissan and had Nissan pay $14.7 million to a business associate who allegedly helped Ghosn handle the red ink.
A Tokyo court has approved Ghosn's detention through Friday, Jan. 11, as prosecutors collect evidence and build their case against him, relying on a Japanese practice of interrogating suspects for hours every day in the absence of their lawyers.
On Jan. 11, prosecutors must either indict Ghosn on the additional charges or let him go. As is often the case in the Japanese system, they might also arrest him again on different, but tangentially related, grounds to continue holding him.