Ghosn Probe Expands to Renault-Nissan-Mitsubishi Finances

Nissan’s investigation into claimed financial wrongdoing by CEO Carlos Ghosn is broadening to cover possible misconduct involving the finances of the Renault-Nissan-Mitsubishi alliance, sources tell Reuters.

Ghosn is chairman of all three companies and their alliance. He was arrested in Tokyo after an internal Nissan investigation reportedly found that Ghosn failed to report $45 million in compensation and was improperly using several luxury homes apparently acquired by the company for his use.

Reuters’ sources say investigators have turned up evidence of possible financial improprieties involving Renault-Nissan BV, a Dutch company that oversees aspects of alliance operations that are ultimately controlled by Renault.

Observers speculate that Hiroto Saikawa, who replaced Ghosn as CEO at Nissan in February 2017, aims to either distance the Japanese carmaker from the alliance or give Nissan more power over alliance decisions.

Nissan has bridled for years over Renault’s control and desire to merge the two companies. Renault holds a 43% controlling interest in Nissan. The Japanese company owns a 15% non-voting stake in Renault. When the alliance was formed 19 years ago, Ghosn arrived to save Nissan from bankruptcy. But today Nissan outsells Renault by roughly 60%.

In announcing this week’s arrest of Ghosn, Saikawa pointedly noted that the alliance concentrates enormous power in one person. He described Renault’s hold over Nissan—and the fact that Renault’s chairman and CEO also is chairman of Nissan—as a “structural issue.”