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Carlos Ghosn claims innocence in first appearance since arrest

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A court sketch of Carlos Ghosn
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Nissan's ousted chairman Carlos Ghosn appeared in the public eye for the first time in seven weeks since his arrest at a court hearing in Tokyo on Tuesday.

Ghosn used his first public appearance to express his "genuine love and appreciation" for the Japanese car maker. He also denied the charges and allegations made against him in November.

“I am innocent of the accusations made against me. I have always acted with integrity and have never been accused of any wrongdoing in my several-decade professional career,” said the former chairman of Nissan.

“I have been wrongly accused and unfairly detained based on meritless and unsubstantiated accusations,” he added.

Ghosn's detention period is set to end on the January 11, however, his lawyer said on Tuesday it could be extended by six months.

Motonari Otsuru told a news conference: "I'm afraid it will take at least another six months until the first trial takes place."

Reuters

The court hearing was demanded by Ghon's lawyers to know why his detention has been prolonged.

Judge Yuichi Tada explained the extended arrest was due to flight risk and the possibility he could conceal evidence.

What are the allegations?

Ghosn was arrested at Haneda airport in Japan on November 19 and was first accused of financial misconduct.

The 64-year old has so far been arrested three times. The first charge he faced was underreporting 10 billion Yen (over €80 million) in income.

Ghosn told the court: “I never received any compensation from Nissan that was not disclosed, nor did I ever enter into any binding contract with Nissan to be paid a fixed amount that was not disclosed.”

The second allegation, which he has not been indicted for, was for aggravating breach of trust in the carmaker by shifting personal investment losses to Nissan at the height of the financial crisis in 2008.

However, he said on Tuesday that he asked the carmaker to temporarily take on his foreign exchange contracts after the 2008-2009 financial crisis prompted his bank to call for more collateral.

He justified doing so as he wanted to avoid resigning and being forced to use his retirement allowance as collateral.

Ghosn said: “My moral commitment to Nissan would not allow me to step down during that crucial time ... A captain doesn’t jump ship in the middle of a storm.”

He is facing another allegation of making $14.7 million (€12.8 million) in payments to Saudi businessman Khaled al-Juffali, using Nissan funds in exchange for arranging a letter of credit to help with his investment losses.

The 64-year-old did not address Juffali's role in providing a letter of credit but said the payments to the Saudi businessman's company were for “critical services that substantially benefited Nissan”.

According to Japanese regulators, Ghosn could face up to 10 years in prison for the financial misconduct charges and a fine of 700 million Yen (over €5.5 million).

Ghon's role with Renault

Ghosn is still chairman of the French car-maker Renault, which owns a 43.4% stake in Nissan and is its biggest shareholder. The future of the alliance could be at risk in a testing time for the industry which has been struck by weaker car demand and a US-China trade spat.

Pressure has also been piled on the French government, which holds 15% of Renault.

French President Emmanuel Macron asked his administrators in December to toughen up on executives who avoid paying taxes in the country.

Reuters

French Government Spokesman, Benjamin Griveaux, has previously said Renault is “strongly managed at this stage, and is also benefiting from strategies that have been implemented for many years” by Ghosn.

In comments to the media last Friday, Griveaux declined to comment on if Ghosn should be stripped of his position at the end of the inquiry.