Will ex-CEO Ghosn’s shocking escape from Japan undermine Uchida’s fresh start?

Industry

TOKYO — If new Nissan CEO Makoto Uchida didn’t have enough headaches facing him in 2020, he probably didn’t count on one new migraine in the making: Carlos Ghosn has gone rogue.

The indicted former Nissan chairman last week stunned the world by jumping bail in Japan and spiriting himself to his ancestral homeland of Lebanon, beyond the clutches of the Japanese justice system.

Why is that a potential headache for the new CEO of Nissan Motor Co.?

Because Ghosn is now free to go on the messaging offensive, broadcasting his allegations about a corporate conspiracy to arrest him last year and keep him jailed and silent about what was happening to the automaker.

Now in Beirut, Ghosn is free to tell his tale without the threat of Tokyo police rearresting him and putting him back in jail. Moreover, by slipping out of Japan, Ghosn has halted his pending criminal trial — which would have been the opportunity for Nissan and Japanese prosecutors to broadcast their own spin on the Ghosn era.

Shortly after he arrived in Lebanon last week, Ghosn said in a statement issued by his representatives that he would start talking to the media this week. The campaign may even kick off with a press conference in Beirut. Ghosn twice attempted to hold a press conference in Tokyo to air dirty laundry about Nissan and Japanese justice, but he was stymied.

Ghosn is likely to target Nissan executives whom he claims turned on him, to lambaste the carmaker’s flailing sales and profit performance since he gave up his CEO title in 2017 and to target what he claims is a rigged Japanese criminal justice system.

He offered a preview in his first public statement after bolting Japan.

“I am now in Lebanon and will no longer be held hostage by a rigged Japanese justice system where guilt is presumed, discrimination is rampant and basic human rights are denied, in flagrant disregard of Japan’s legal obligations under international law and treaties it is bound to uphold,” Ghosn said. “I have not fled justice — I have escaped injustice and political persecution.”

Having Ghosn on the loose promises more embarrassment and distraction for Uchida, who took office Dec. 1 with a daunting to-do list. The former purchasing executive who now runs Japan’s No. 2 carmaker must battle slumping profits, an aging product portfolio and soured relations with its alliance teammate Renault.

Capping Nissan’s bad year, a California dealer group filed suit last month against Nissan and two subsidiaries, alleging that “a culture of corporate corruption and greed” at the carmaker forced the plaintiffs into a “fire sale” of two of its popular dealerships to “cronies” of Ghosn.

How Ghosn managed to slip out of Japan undetected, despite being monitored and limited in his movement while under arrest, remained a mystery last week. 

Speculative accounts included scenarios of flying out on a private plane, using a double passport and even — according to some Lebanese media — being smuggled out while hiding in a musical instrument case.

Surveillance camera footage shows Ghosn last leaving his Tokyo residence on Dec. 29, according to Japanese public broadcaster NHK, which cited Japanese police. There is no record of him ever going back. The camera was installed near his front door as part of the strict bail conditions set for Ghosn’s release from jail last year.

Reuters reported over the weekend that a private security firm hired by Nissan ended surveillance of Ghosn’s Tokyo residence on Dec. 29 after Ghosn’s lawyers warned the surveillance violated the executive’s civil rights. 

Prosecutors had argued against granting him any bail at all. But the Tokyo District Court ruled otherwise, saying that close monitoring and the surrendering of Ghosn’s passports would be enough to prevent his flight. Ghosn’s audacious escape, say critics, proves that prosecutors’ fears were right.

Ghosn had been awaiting trial in Japan on four indictments for alleged financial misconduct during his long leadership of Nissan. He was initially arrested Nov. 19, 2018. But the fallen auto titan may never return to face a judge. Ghosn, whose parents were Lebanese, grew up in Lebanon and holds Lebanese citizenship — and Lebanon has no extradition treaty with Japan.

But in a new twist, Ghosn — now an international fugitive — may find it difficult to ever leave Lebanon.

The country received an Interpol warrant last week for his arrest, a Lebanese judicial source told Reuters, although the power of that warrant is debatable. Meanwhile, Turkish police detained seven people, including four airplane pilots, as part of an investigation into Ghosn’s alleged transit through Istanbul on his way to Beirut, Reuters said.

Ghosn’s Japanese lawyer said he only learned of his client’s vanishing act on the morning news.

Indeed, all of Japan was flabbergasted and slow to react, since the escape occurred as Japan headed into its extended three-day break for New Year, the nation’s most important holiday.

Ghosn’s attorney Junichiro Hironaka told reporters that orchestrating such an escape would have been impossible without a “huge organization” of accomplices. Ghosn later issued a statement saying he alone arranged the departure and that his family “had no role whatsoever.”

One bail restriction that particularly exasperated Ghosn was a court-ordered ban on contact with his wife, Carole. Ghosn was permitted to speak with her in November for the first time in seven months, and then for only one hour — and only via video conference in his lawyer’s office.

Ghosn faces four charges in Japan. The first two are for allegedly failing to disclose tens of millions of dollars in deferred compensation. The two other counts are breach of trust charges that accuse Ghosn of diverting company money for personal gain.

He denies the entire slate but faced up to 15 years in prison and a fine of up to ¥150 million ($1.4 million) if he were convicted on all four counts. But bolting Japan may also cost him: Ghosn now likely will have to forfeit ¥1.5 billion ($13.8 million) in bail money that he posted in cash.

Ghosn’s lawyers and wife have expressed doubt that the former boss of the Renault-Nissan-Mitsubishi alliance could ever get a fair trial in Japan, where the conviction rate is 99 percent.

His defense has argued that prosecutors illegally conspired with Nissan executives and government officials to frame Ghosn and remove him from power to prevent a full merger of Nissan with French alliance partner Renault.

Ghosn’s lawyers also have said that prosecutors violated his rights by collecting evidence illegally and denying his right to a speedy trial. The case wasn’t expected in court until this spring, but a trial date had not been set.

Hironaka said that while Ghosn’s breaking bail was wrong, it is still understandable.

“I can understand why Mr. Ghosn thinks the way he does,” Hironaka said. “I believe there must have been a number of things unacceptable to him, ranging from the way he was detained to how the prosecutors gathered evidence.

“He doesn’t seem to trust the Japanese judicial system. It seems to me that he is trying to say a fair trial wouldn’t be possible.”

Naoto Okamura contributed to this report.

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