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The Nissan Motor Co representative, who was arrested with President Carlos Ghosn for allegedly conspiring for financial misconduct, denied that Ghosn's salary was under-reported in the company's securities reports, Saturday announced sources close to the case.
Greg Kelly said that Nissan's securities reports were properly written and that they were not a problem, the sources said. This is the first time both Nissan officials have commented on the charges since their arrest on Monday. Ghosn, 64, and Kelly, 62, were dismissed from an emergency council meeting on Thursday.
Kelly refuted the intention to misrepresent Ghosn's salary in the securities reports, claiming that he had written these reports after consulting company officials and not on the orders of Ghosn, according to sources.
Tokyo prosecutors have arrested Ghosn for an alleged underreporting of his salary of about 5 billion yen ($ 44 million) over five years throughout the 2014 fiscal year, while receiving close to 10 billion yen during this period.
The arrest took place after a small group, made up of board members, illegally conducted an internal investigation beginning this spring, according to other sources close to the case.
The internal investigation was triggered by an early warning report. Until then, although some suspect that Ghosn was diverting funds from Nissan, he was so powerful that people were afraid to criticize him, according to sources.
Ghosn is also suspected of attempting to conceal 8 billion yen of salary by underreporting his salary for eight years, according to other sources close to the case.
He reportedly determined compensation at around 2 billion yen a year and underreported it by half, the sources said.
Ghosn would have reduced his compensation to avoid criticism of Nissan shareholders, they said.
The underreporting that would have continued over the three years since fiscal 2015 would bring the total amount covered to about 8 billion yen, they said.
Nissan's auditors suspect the company of buying homes for Ghosn through an Amsterdam-based foreign investment subsidiary, Zi-A Capital BV, said the sources.
Nissan invested about 6 billion yen when it was created in 2010.
Ghosn became a member of Zi-A Capital's board of directors when it was formed, but resigned the following year. Kelly and some former Nissan executives are on the list of members of his board of directors.
© KYODO
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