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Tokyo prosecutors believe Carlos Ghosn made fictitious claim over payments to Saudi friend: sources

JIJI

Former Nissan Motor Co. Chairman Carlos Ghosn is believed to have made fictitious claims over questionable payments to a Saudi friend of his, informed sources told Jiji Press on Tuesday.

Ghosn has claimed that the payments totaling $14.7 million were made in compensation for helping to resolve a problem facing the automaker in the Middle East. But Nissan was not aware of the problem, the sources said.

Tokyo prosecutors apparently suspect that Ghosn’s claim is false and that the payments were made in return for the Saudi businessman’s help in dealing with the former Nissan chairman’s massive personal investment losses.

Ghosn has been charged for allegedly underreporting his executive pay in Nissan’s financial reports. Ghosn also faces suspicions that he shifted his personal losses to the automaker.

In 2008, a company managing Ghosn’s assets incurred an appraisal loss of some ¥1.85 billion over a currency swap deal with Shinsei Bank, according to the investigation by the prosecutors.

Ghosn transferred the financial derivatives contract to Nissan in October 2008. After the transaction was called into question by the Securities and Exchange Surveillance Commission, the contract was apparently returned to the asset management company in February 2009.

The Saudi businessman is believed to have helped Ghosn to put up additional collateral sought by Shinsei Bank over the contract when it was returned to the asset management company.

The $14.7 million payment was said to be made in four installments between June 2009 and March 2012 by a Nissan subsidiary into a bank account of a company run by the Saudi businessman.

According to sources familiar with the situation, Ghosn claims that the Saudi businessman helped Nissan to resolve a problem with its biggest operation base in the Middle East, and that the money in question was paid to the businessman for his assistance, including lobbying activities.

While Ghosn claims Nissan is aware that the businessman has made efforts for the company, the automaker has told the prosecutors that it does not know about the problem, the sources said.

Prosecutors are investigating the relationship between Ghosn and the Saudi businessman, who are believed to have known each other for 30 years.