Nissan and Ghosn to pay 16m dollars to settle SEC civil fraud charges

Nissan has agreed to pay 15 million US dollars (£12m) and its former chairman Carlos Ghosn is paying one million dollars (£800,000) to settle US federal regulators’ civil fraud charges.

The Securities and Exchange Commission (SEC) announced the settlement on Monday with the Japanese carmaker and its former chairman, who also agreed to be barred for 10 years from serving as an officer or director of a public company.

Mr Ghosn is awaiting trial in Japan on financial misconduct allegations.

Mr Ghosn, who led Nissan for two decades, was arrested by Japanese authorities in Tokyo and jailed four times since November.

He has maintained he is innocent.

He is currently out on bail but faces restrictions on his activities such as not being allowed to contact his wife, Carole Ghosn.

She has appeared before a Japanese judge to answer questions in the case. The first hearing in the trial has been set for April.

Mr Ghosn and Nissan Motor Co settled the charges without admitting or denying the SEC’s allegations, but agreed to refrain from future anti-fraud violations of the securities laws.

In addition, a former Nissan director, Greg Kelly, agreed to pay a 100,000 dollar penalty to settle the SEC charges, to be barred for five years from serving as an officer or director of a public company, and to be suspended for five years from practising as a lawyer before the SEC.

In a statement, Mr Ghosn’s team of lawyers noted that he will be allowed to contest and deny the allegations in the criminal case in Japan, and they said he “fully intends to do so”.

“Mr Ghosn and his defence team are now able to focus their efforts on continuing to vigorously fight the criminal case in Japan and pursue his claims against Nissan around the world,” the statement said.

“They remain confident that, if given a fair trial, he will be acquitted of all charges and fully vindicated.”

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Lawyers representing Nissan declined to comment on the SEC settlement.

A lawyer for Mr Kelly was not immediately available for comment.

The SEC alleged Mr Ghosn with the help of Mr Kelly and subordinates at Nissan conducted a scheme to conceal more than 90 million dollars of his compensation from investors and public disclosure, while also acting to increase his retirement benefits by over 50 million dollars.

“Simply put, Nissan’s disclosures about Ghosn’s compensation were false,” Steven Peikin, co-director of the SEC’s enforcement division, said in a statement.

“Through these disclosures, Nissan advanced Ghosn and Kelly’s deceptions and misled investors, including US investors.”