SEC Complaint Details How Ghosn Hid Payments

Former Nissan Motor Co. Chairman Carlos Ghosn and senior associates went to considerable lengths to avoid disclosing his compensation, according to the Securities and Exchange Commission complaint that was settled yesterday.

The subterfuge began as Japan’s corporate disclosure rules expanded in 2009, Bloomberg News reports. As the simultaneous chief of Nissan and Renault SA, Ghosn’s annual compensation was already highlighted each year by Japanese and European media.

Ghosn’s paid and postponed compensation were being tracked internally in a spreadsheet, according to the SEC. It says Ghosn and his associates pondered several methods to channel much of his compensation through “Nissan-related entities without disclosure.”

The SEC complaint says Ghosn opted instead to postpone certain payments. But by 2013, it says, Ghosn used backdated letters to access a long-term incentive plan through which cash could be released to him, Bloomberg reports.

Ghosn also hiked his retirement allowance by more than $50 million, the SEC says. The method involved backdating letters that described his retirement awards. To avoid having to declare the increases, Ghosn and his associates decided to dismiss the gains publicly as a miscalculation, the SEC said.