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SEC charges Nissan and Ghosn with concealing $140 million in deferred compensation

The Securities and Exchange Commission Monday charged Nissan and its former CEO Carlos Ghosn with fraud for failing to disclose more than $140 million to be paid to Ghosn in retirement.

Greg Kelly, a former Nissan director, was also charged.

The defendants all agreed to settle with the SEC.

The agency charged Nissan and Ghosn in an internal administrative order with violating the anti-fraud provisions of the Securities Exchange Act of 1934. It charged Kelly with aiding and abetting their violations.

Nissan agreed to pay a $15 million civil penalty.

Ghosn, 65, agreed to pay a $1 million civil penalty and be banned for ten years from serving as an officer or director of a public company.

Kelly, 62, agreed to a $100,000 penalty, a five-year officer and director ban, and a five-year suspension from practicing or appearing before the SEC as an attorney.

All three settled without admitting or denying the SEC’s allegations and findings.

Beginning in 2004, Nissan’s board gave Ghosn the authority to set individual director and executive compensation levels, including his own, the SEC said.

From 2009 until his arrest in Tokyo in November 2018, Ghosn, with help from Kelly and others at Nissan, “concealed more than $90 million of compensation from public disclosure, while also taking steps to increase Ghosn’s retirement allowance by more than $50 million.”

They hid the allocations by using “secret contracts, backdating letters to grant Ghosn interests in Nissan’s Long Term Incentive Plan, and changing the calculation of Ghosn’s pension allowance to provide more than $50 million in additional benefits,” the SEC said.

The $140 million in undisclosed compensation and retirement benefits was never paid out to Ghosn. The money would have been due after his retirement.

The SEC’s complaint against Ghosn and Kelly is here (pdf) and Nissan here (pdf).


Richard L. Cassin is editor at large of the FCPA Blog.

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  1. $140 million stolen but only paid a $1 million civil penalty by CEO Carlos Ghosn, did he have to return the stolen money as well?

  2. Seems the SEC may still be broken. They investigated Bernie Madoff 5 times and never found out he was running a Ponzi scheme. I would recommend reading The Chickenshit Club, Why the Justice Department Fails to Prosecute Executives by Jesse Eisinger if you want a broader view of this "no admit / no deny" trend…

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