TOKYO: A former Nissan Motor Co. division head Wednesday testified that some remuneration to former Chairman Carlos Ghosn was kept undisclosed in a way that seemed questionable under law.

There was remuneration that had not been paid yet to Ghosn and not reported in Nissan securities filings, said the former head of the secretary office, who had reached a plea bargain with prosecutors.

The treatment of the remuneration appeared to be “against the spirit of the financial instruments and exchange law,” the former office head told Tokyo District Court in a trial against former director Greg Kelly, who was a close aide to Ghosn.

Kelly, 64, has been charged with violating the law over his alleged involvement in hiding part of the pay to Ghosn, 66.

In the day’s hearing, the former secretary office head said there were three types of remuneration to Ghosn–fixed, paid and unpaid pay.

Ghosn instructed the former office head to manage the three types of his remuneration around the end of March 2011, and the former head submitted pay plans, including how to calculate the unpaid portion, to Ghosn, according to the witness.

In February 2010, the Financial Services Agency released a draft reform plan that would require the disclosure of the names of corporate executives earning 100 million yen or more annually.

A few days later, Kelly asked the former office head about the amount of remuneration to Ghosn that Japanese people would consider appropriate.

Although the total pay to Ghosn was 1.6 billion yen in fiscal 2009, which ended in March 2010, the former office head told Kelly that less than 1 billion yen should be viewed as appropriate.

Later, the former office head considered ways to reduce the amount of remuneration to Ghosn that would be disclosed, according to the day’s testimony.

The treatment was “intended to evade disclosure and therefore considered to be against the spirit of law,” the former office head said.

The former office head reached the plea bargain with the Tokyo District Public Prosecutors Office in November 2018, agreeing to submit documents and testify at court to escape indictment.

The prosecutors office regards the former office head as one of the most important witnesses. The person is scheduled to appear in court over 20 times until December.

Ghosn jumped bail and fled Japan to Lebanon late last year ahead of a planned trial over his alleged financial misconduct.

According to an indictment, Kelly conspired with Ghosn to underreport Ghosn’s pay by a total of 9.1 billion yen over the eight years to fiscal 2017 in securities filings submitted to financial authorities.

JIJI Press