On 23 September 2019, there was an important development in the ongoing legal battle: the United States Securities and Exchange Commission (SEC) announced in a press release that it would not be prosecuting Carlos Ghosn. This settled American legal proceedings and enabled Carlos Ghosn to concentrate on his defense in Japan.
Proceedings had been initiated in the US because Nissan’s shares are listed on US stock markets and the American regulator was therefore entitled to investigate whether Carlos Ghosn had broken American law by failing to make the necessary disclosures to the market.
The agreement negotiated with the US regulator covered an amount of US$1 million and allowed Carlos Ghosn to settle without admitting or denying the SEC’s allegations and findings.
Carlos Ghosn’s defence team published a declaration stating that:
« This agreement with the SEC specifies that Mr Ghosn may continue to contest legal actions and deny accusations made against him in Japanese criminal proceedings and he is determined to do this. Mr Ghosn remains confident that, should he receive a fair trial, all charges against him will be dismissed and he will be acquitted ».Avocats de Carlos Ghosn
When she was interviewed on CNBC, Carole Ghosn explained the details of this agreement, emphasizing that her husband did not actually receive any of the amounts mentioned in the investigation.
In a nutshell, the SEC’s investigators did not find enough proof or evidence of wrongdoing to warrant legal proceedings against Carlos Ghosn in the United States. This situation was explained by one of his French lawyers, François Zimeray, on France Info radio.
Indeed, this was a setback for Japanese prosecutors and for Nissan who probably hoped to use US legal proceedings in tandem with those initiated in Japan.
Moreover, this announcement came on the same day as revelations published in the Wall Street Journal concerning serious conflicts of interest in a key component of Nissan’s accusations: an internal investigation in which Hari Nada played a murky role.
In addition to the plea bargain he signed with Japanese prosecutors, and his appearance in the findings of Christina Murray’s internal audit, Mr Nada also stands accused of collusion with Latham & Walkins, the firm hired to conduct the investigation into Carlos Ghosn whose report was never submitted in full to the Nissan directors – they only received a five-page summary of the report.
In a letter submitted to the Board of Directors, Ravinder Passi, Global General Counsel at Nissan, described the role of Latham & Walkins in the following terms:
“I believe that these matters create substantive concerns, and that these issues will come to a head in due course and create exposure and risk for the company. Nissan executives […] were mindful of the risk of potential conflicts of interest throughout the investigation process”Ravinder Passi – VP Legal Affairs Nissan
All of these elements increased the suspicion of collusion between Nissan and the Japanese prosecutors