A district court in Tokyo has refused to grant bail to embattled automotive executive Carlos Ghosn as he awaits trial on charges of under-reporting his income by millions of dollars and breach of trust during his nearly two-decade career at the helm of Nissan Motor Co. Ltd., Reuters reported Jan. 15.
Although Ghosn's release prior to his trial had looked increasingly doubtful as prosecutors repeatedly extended his custody, which began Nov. 19, the confirmation that Ghosn will now likely face many months in prison could increase pressure on the board of French automaker Renault SA to consider finding replacements for the CEO and chairman roles he still occupies.
The French car company has refused to dismiss Ghosn until it receives evidence of his alleged misconduct. COO Thierry Bollore was appointed deputy CEO to oversee day-to-day management of the company following Ghosn's arrest.
Officials from the French government, a key Renault shareholder, said Jan. 14 that Ghosn would remain at the French carmaker unless it became apparent that he would be "chronically incapacitated" by the legal proceedings, Reuters reported.
Both Nissan and Mitsubishi Motors Corp. have removed Ghosn as chairman. At a Jan. 8 court hearing Ghosn denied all allegations made against him.
Ghosn held leadership roles at all three companies and was the key architect of a cost-saving alliance between them, which has so far survived the turmoil of his arrest. The companies have said they remain committed to preserving the alliance through which they share some technologies and collaborate on procurement and manufacturing.
Ghosn is accused of reporting a lower salary to Japan's securities regulator to avoid public criticism of his pay package in a country where executive remuneration tends to be lower than in other developed economies. He has also been charged with breach of trust after temporarily transferring a loss-making foreign exchange bet to Nissan. Though it was Nissan that alerted prosecutors to its suspicions concerning Ghosn's conduct, the company has also been charged over its suspected involvement in the under-reporting of Ghosn's income.