published in January 7, 2019 |
from Maarten Vinkhuyzen
January 7, 2019 per Maarten Vinkhuyzen
Update: Ghosn appeared in court and denied everything potential charges. Confused? Read this article about the legal system of Japan. Ghosn's complete statement to the judge is attached below before the original article.
January 7, 2019
Statement by Carlos Ghosn
I am grateful to finally have the opportunity to speak publicly. I am anxious to begin the process of defending myself against the accusations that have been made against me.
First, let me say that I have a genuine love and appreciation for Nissan. I firmly believe that in all my endeavors on behalf of the company, I have acted honorably, legally and with the knowledge and approval of the appropriate executives within the company – for the sole purpose of supporting and strengthening Nissan and helping to restore its place as one of the best and most respected companies in Japan.
Now I would like to address the allegations.
1. Futures exchange contracts
When I first entered Nissan and moved to Japan almost 20 years ago, I wanted to be paid in US dollars, but I was told that this was not possible and that I received a work contract that required me to be paid in Japanese Yen. I have long been concerned about the volatility of the yen against the US dollar. I am an individual based on the US dollar – my children live in the US and I have strong ties with Lebanon, whose currency has a fixed exchange rate against the US dollar. I wanted predictability in my income to help me take care of my family.
To address this issue, I entered into foreign exchange contracts during my entire mandate at Nissan from 2002. Two of these contracts are under discussion in this process. One was signed in 2006 when Nissan's share price was about 1,500 yen and the yen was 118. The other was signed in 2007 when Nissan's share price was 1400 yen and the yen rate 114
The financial crisis of 2008-2009 caused Nissan's shares to fall to 400 yen in October 2008 and to 250 yen in February 2009 (down more than 80% from the peak) and the yen rate fell from 80 It was a perfect storm no one foresaw. The whole banking system was frozen and the bank asked for an immediate increase in my guarantee on the contracts, which I could not satisfy alone.
I was faced with two rigid choices:
1. Renounce Nissan to receive my retirement bonus, which I could use to provide the necessary guarantee. But my moral commitment to Nissan would not allow me to resign during this crucial moment; a captain does not jump in the middle of a storm.
2. Ask Nissan to temporarily take over the warranty, as long as this does not incur costs for the company, while I receive assurances from my other sources.
I chose option 2. The exchange contracts were then transferred back to me without Nissan incurring any loss.
2. Khaled Juffali
Khaled Juffali has long been a supporter and partner to Nissan. During a very difficult period the Khaled Juffali Company helped Nissan to apply for funding and helped Nissan solve a complicated problem involving a local dealer – in fact, Juffali helped Nissan restructure troubled distributors across the Gulf region, allowing Nissan to compete better with rivals such as Toyota. Nissan. Juffali also helped Nissan negotiate the development of a factory in Saudi Arabia by organizing high-level meetings with Saudi officials.
The Khaled Juffali Company was duly compensated – an amount advertised and approved by appropriate Nissan officials – in exchange for these critical services that substantially benefited Nissan.
3. The allegations of FIEL
Four major companies sought to recruit me while I was CEO of Nissan, including Ford (by Bill Ford) and General Motors (by Steve Rattner, then Car Czar under President Barack Obama). Although his proposals were very attractive, I could not, in my right mind, abandon Nissan while we were in the midst of a turnaround. Nissan is an iconic Japanese company that interests me deeply. Although I chose not to pursue the other opportunities, I kept a record of the market pay for my role, which these companies offered me if I had taken on these jobs. This was an internal reference I kept for my own future reference – it had no legal effect; was never shared with the directors; and never represented any kind of binding commitment. In fact, the various non-competition proposals and post-retirement advisory services made by some board members did not reflect or refer to my internal calculations, highlighting their hypothetical and non-binding nature.
Contrary to prosecutors' charges, I never received any compensation from Nissan that was not disclosed, nor did I ever enter into any binding contract with Nissan to receive a lump sum that was not disclosed. Further, I understood that any proposal for proposal for post-retirement compensation was reviewed by internal and external attorneys, showing that I had no intention of violating the law. For me, the test is the "death test": If I died today, would my heirs require Nissan to pay anything other than the retirement pension? The answer is an unequivocal "No".
4. Contribution to Nissan
I dedicated two decades of my life to revive Nissan and build the Alliance. I worked toward these goals day and night, on the ground and in the air, standing shoulder to shoulder with Nissan workers around the world, to create value. The fruits of our work were extraordinary. We transformed Nissan from a 2 trillion yen position in 1999 to a 1.8 trillion yen box at the end of 2006, from 2.5 million cars sold in 1999 with a significant loss to 5.8 million yen. cars sold in 2016. Nissan's asset base tripled over the period. We saw the rebirth of icons like Fairlady Z and Nissan G-TR; Nissan's industrial entrance in Wuhon, China, St. Petersburg, Russia, Chennai, India and Resende, Brazil; the pioneering of a mass market for electric cars with Leaf; the jumpstarting of autonomous cars; the introduction of Mitsubishi Motors in the Alliance; and the Alliance becoming the world's number one automotive group in 2017, producing more than 10 million cars annually. We created, directly and indirectly, countless jobs in Japan and reestablished Nissan as a pillar of the Japanese economy.
These achievements – guaranteed alongside Nissan's unparalleled team of employees around the world – are the greatest joy of my life, with my family.
Your Honor, I am innocent of the charges against me. I have always acted with integrity and have never been accused of any crime in my professional career for several decades. I have been unjustly accused and wrongfully detained on the basis of merciless and baseless charges.
Thank you, Your Honor, for hearing me.
After seven weeks in prison, Carlos Ghosn is receiving a court hearing. His lawyers can ask questions and he can read a statement. As he should write a statement while he is denied pen and paper is beyond me.
What is also beyond me is the Japanese justice system.
Now we know more in detail than he is accused. He is accused of failing to properly disclose to the shareholders the retirement payments he earned that year. According to his advisors at the time the annual reports were written, he was not obliged to do so. In order to keep it longer in custody, the acquisition was split to cover two periods, allowing for 46 days of custody instead of "only" 23.
The third acquisition is about an even less clear case. In 2008, Carlos Ghosn received a margin call, just like millions of others during the height of the great recession. The world banking system had frozen credit, even for many credit customers. Carlos Ghosn had a liquidity problem, not a solvency problem. A friend gave you a letter of credit to use as collateral. It is not revealed that the letter of credit was withdrawn. If it were, it would certainly have been mentioned. That would create a completely different situation.
Prosecutors are trying to prove that Ghosn paid an amount equal to the value of the card. This is crazy Normal costs are 1% to 2% and even for a friend, Ghosn is a very good businessman to pay too much for that margin.
In any other OECD country, these types of misdemeanors are good for a fine of up to a few thousand dollars. Maybe an arrest for a few hours to run a search warrant. No solitary confinement, lengthy interrogations, limited contact with lawyers and representatives or family members, denying adequate food and blankets, denying writing materials. And all this for as many months as the prosecutors want to insure it.
I hope Carlos Ghosn issues a type of "J & # 39; Accuse" rebuttal. Put the Japanese justice system in the dock. Treatment like this is classified as torture in other countries. It can be classified as cruel and unusual punishment.
And maybe he dropped the bomb that was about to dismiss Nissan CEO Hiroto Saikawa.
No matter what happens, it will be fireworks.
Useful related stories:
"I was wrongly accused and wrongfully arrested": Carlos Ghosn at the first hearing
Carlos Ghosn's arrest is more about Japanese criminal justice than about corporate governance