Carlos Ghosn and Nissan have been formally indicted by Japanese authorities on charges of financial misconduct.
Ghosn was arrested last month following allegations that he had under-reported his income. He was detained without charges for the maximum 22 days allowed under Japanese law, but was served with a new warrant on Monday following fresh allegations that the practice went on for even longer than the originally-claimed five years. Nissan itself was targeted by prosecutors on Monday after being accused of assisting in the misconduct, while Greg Kelly, a former Nissan executive who was implicated alongside Ghosn in the original allegations, was also indicted.
“Nissan takes this situation extremely seriously,” the company said in a statement. “Making false disclosures in annual securities reports greatly harms the integrity of Nissan’s public disclosures in the securities markets, and the company expresses its deepest regret.”
Nissan shares fell 3 percent in Tokyo following Monday’s developments.
Prior to the allegations, Ghosn was one of the world’s top automotive executives, heading all three arms of an alliance between Nissan, Mitsubishi and Renault. It was through his role with the latter that he signed off on the French manufacturer’s return to Formula 1 as a full constructor.
Nissan and Mitsubishi have since removed him from his posts, while Renault has temporarily replaced him as CEO and chairman. The new charges allow authorities to extend the detention of Ghosn and Kelly for further questioning.
According to reports, the maximum penalty for under-reporting income in Japan is 10 years in prison and a fine of up to 10 million yen ($88,000). Ghosn’s income was originally alleged to have been under-reported by around 5 billion yen ($44.2m) over five years.