TOKYO -- Carlos Ghosn paid nearly $50 million to businesses run by two Middle Eastern acquaintances from the cash reserve at the center of breach of trust allegations against the former Nissan Motor chairman, sources familiar with the matter told Nikkei.
Nissan dealers in Oman and Lebanon received $32 million and $16 million, respectively, through Dubai-based Nissan Middle East, the sources said. This occurred around the same time that Ghosn paid a total of $14.7 million to a business run by Saudi associate Khaled al-Juffali, allegedly as compensation for help covering personal losses in the wake of the 2008 financial crisis.
Each of these payments came out of Nissan's "CEO reserve," an internal fund that Ghosn could tap at his discretion. Tokyo prosecutors, who have accused Ghosn of breach of trust over the al-Juffali payments, suspect that the ex-chairman may have had the fund set up to handle private issues. Investigators are looking into whether the ex-chairman diverted cash from the reserve for other personal uses outside the scope of those allegations.
Whether the Yokohama-based automaker made similarly large payments from the CEO reserve to other dealers elsewhere in the Middle East has not been confirmed, the sources said. Ghosn was raised in Lebanon.
The CEO reserve was set up at Nissan Middle East at Ghosn's request around December 2008. This was not long after Ghosn's personal asset management company suffered heavy paper losses on a currency swap contract with Shinsei Bank.
When the Tokyo-based bank demanded more collateral, Ghosn initially transferred the position -- and the burden of the 1.85 billion yen ($17.2 million at current rates) loss -- to Nissan, a move that constitutes part of the breach of trust allegations against the former chairman.
The position was soon shifted back to Ghosn's asset management company, and al-Juffali helped arrange a letter of credit to satisfy the collateral request. Al-Juffali's company received $14.7 million from the CEO reserve in four installments between 2009 and 2012.
Ghosn asserts that this was legitimate payment for services rendered, including lobbying the Saudi government and dealing with trouble between Nissan and local dealers, according to his lawyer. Al-Juffali has been involved in auto distribution in Saudi Arabia for many years, and his company and Nissan announced a joint venture in October 2008.
