Carlos Ghosn, Chairman and CEO of the Renault-Nissan Alliance, reacts during a news conference in Paris, France, September 15, 2017. Image Credit: Reuters

Tokyo: Handcuffed and wearing plastic slippers, Carlos Ghosn appeared in a Japanese court to rebuff prosecutors’ allegations of financial wrongdoing.

As he vigorously defended himself against charges that he failed to disclose income from Nissan Motor Co, his sunken cheeks and graying hair underscored his downfall from the apex of the business world where he built a nine-figure fortune.

The appeal by Ghosn’s lawyers against his prolonged detention since his arrest on November 19 was rejected on Wednesday by the Tokyo District Court. The judge rejected the arguments, reiterating concerns that he might flee Japan or tamper with evidence. Denial of bail for months is common in Japan’s criminal system and is often criticised as “hostage justice”. Ghosn’s detention on suspicion of breach of trust had been approved through Friday, and likely will be extended. No trial date has been set.

According to an analysis by the Bloomberg Billionaires Index, Ghosn, 64, amassed a net worth of about $120 million (Dh441.36 million) over the decades he spent atop the automotive industry. He owns about $60 million of shares in Nissan, Renault SA and Mitsubishi Motors Corp. Disclosed salaries and dividends over the years total another $60 million or so.

I believe it could be considered that at least six months will be needed before being able to go
to the first trial.

- Motonari Otsuru, Carlos Ghosn’s lawyer

But his fortune could be even higher. The figure excludes compensation he received from Nissan before it was first disclosed in 2010, which could run into tens of millions of dollars. His lawyers, represented by Motonari Otsuru, declined to comment on his wealth.

The brash Ghosn won fame for turning around Nissan more than a decade ago and leading a sprawling car-making alliance that also includes Renault of France and Mitsubishi Motors of Japan. His life and lucrative career were upended when Japanese prosecutors detained him on suspicion of understating his compensation in regulatory filings. Accusations against him have piled up since, and authorities repeatedly extended his confinement, straining ties with Renault and leaving open the question of who will run a business that combined sells more than ten million cars annually.

Failure to disclose income

In prepared remarks to the court, Ghosn noted that when other companies tried to recruit him from Nissan, he kept “a record of the market compensation for my role, which those companies offered me if I had taken these jobs”.

The hearing was Ghosn’s first chance to give his side of the story, and he laid out his defence against charges he failed to disclose income from Nissan and saddled the carmaker with trading losses. Nissan also accused Ghosn of misusing company funds, including over his use of homes from Brazil to Lebanon and the hiring of his sister on an advisory contract. For most people, Ghosn’s fortune is an almost inconceivable level of wealth, and allegations that he would seek to bolster it might appear outlandish.

But in the realm of superstar executives, a nine-figure fortune can seem like slim pickings. The expenses underscore a widening wealth gap between the rich and the really rich, a little-seen realm where the elite level of service at some private banks is now the preserve of those with $1 billion. That disconnect — only experienced by a tiny fraction of the population — offers one explanation for why Ghosn sought to bolster his pay and award himself lucrative post-retirement compensation.

Ghosn has denied wrongdoing regarding all of these compensation programmes, which could have swelled his fortune to more than $200 million, according to calculations by Bloomberg. Such material riches are now a distant prospect for the embattled executive. After his court appearance, he returned to the Tokyo jail where his days are broken up by 30 minutes of prescribed exercise and three meals.