Carlos Ghosn, chairman of the Nissan Motor Co., Renault SA and Mitsubishi Motors Corp. alliance, is set to be arrested for allegedly violating a financial law, local media reported Monday.
According to the reports, Ghosn, 64, who was questioned Monday by the Tokyo District Public Prosecutors Office, is facing arrest on suspicion of under-reporting his corporate salary, sources close to the matter said.
Investigators with the Tokyo District Public Prosecutors Office have been looking at suspected violations of Japan's Financial Instruments and Exchange Law and believed that Ghosn may have filed corporate financial statements and entries that were millions of U.S. dollars less than actual earnings, sources said.
The undeclared earnings were used for personal reasons by Ghosn, Nissan has indicated.
While saying it will fully cooperate with the prosecutors' investigation of Ghosn, Nissan has said that it will propose dismissing Ghosn as chairman at a board meeting.
The automaker has also said it will propose that Greg Kelly, a member of the board, also be dismissed for improper practices.
Ghosn's improprieties, according to Nissan, came to light several months ago, following a whistleblower reporting the chairman's misconduct.
In 1999, Ghosn became Nissan's chief operating officer and was charged with boosting the at-the-time ailing automaker's market and profit margins, under a capital alliance with Renault.
In 2000, Ghosn was promoted to president of Nissan and turned the automaker around through cost-cutting and restructuring measures, including the closure of some of the firm's plants.
Ghosn, a French citizen who was born in Brazil, became CEO in 2001 and convinced shareholders he would stay with the automaker until it had been fully rehabilitated.
Continuing with his aggressive cost-cutting and streamlining measures, he became Renault's CEO in 2005 and advocated for joint procurement and development under the Nissan-Renault alliance.
Nissan's headquarters in Tokyo were searched by the Tokyo District Public Prosecutors' Office for evidence related to the allegations against Ghosn, Japan's public broadcaster NHK said Monday evening.
A spokesperson for Nissan Motor said of the matter that "we are currently checking the facts."
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