Former Nissan executive Greg Kelly feels that the issue of Carlos Ghosn’s under-reported Nissan compensation is a matter for the boardroom and could have been solved there. Now Kelly waits, out on bail, to see whether Japan considers if he committed a crime, or just tried to solve a business problem. The Associated Press has the story:
Kelly faces up to 15 years in prison if convicted; more than 99% of Japanese criminal trials result in conviction
TOKYO (AP) — Nearly three years later, former Nissan executive Greg Kelly is still wondering why the questions that led to his arrest and trial in Japan weren’t simply taken up in the automaker’s corporate boardroom.
Kelly, an American lawyer who worked for three decades for Nissan Motor Co., is awaiting a verdict in his trial on charges of financial misconduct in the case of Carlos Ghosn. The embattled former chairman of the Renault-Nissan-Mitsubishi alliance jumped bail and fled to Lebanon in late 2019, leaving Kelly in Japan alone to face charges of Ghosn’s under-reported Nissan compensation. Kelly has denied the allegations.
“I don’t think any of us were involved in a crime, or a criminal activity,” Kelly told The Associated Press in an interview Wednesday in his Tokyo apartment, where he is out on bail.
“We were involved in trying to solve a business problem, which was: What actions do you take that are lawful to retain a very valuable executive who was underpaid?” Kelly added, referring to Ghosn.
“It should have been resolved at the corporate level at Nissan. It’s not a criminal matter,” said Kelly, who faces up to 15 years in prison if convicted and is forbidden from leaving Japan as he awaits his fate. A verdict is not expected until March. More than 99% of Japanese criminal trials result in convictions.
Behind him, the walls of the apartment Kelly shares with his wife, Dee, were plastered with photos of his two grandsons, including a 20-month-old baby he has never held. Family is most important, the 64-year-old Kelly said, especially this late in life.
“When you get into your 60s, you’re not looking at a long horizon,” Kelly said.
“Every day that you miss with your family, you know, that to me is the stress. To spend 33 months without my family. For a corporate matter, it just doesn’t make a lot of sense.”
HOW IT HAPPENED
Kelly was working for Nissan but living in the Nashville area of Tennessee when he was asked to come to Japan for a meeting in November 2018. Since he was scheduled for neck fusion surgery to address a painful spinal condition he suggested a video conference. But Nissan booked a corporate jet for him, promising he would be back within the week.
After landing in Japan, he got in a van. The driver asked if he could pull over and make a call. Suddenly the van door opened, and several men rushed in, identifying themselves as prosecutors and a translator.
Kelly was taken to a detention center, handcuffed and searched, then led to an interrogation room, and questioned by prosecutors, initially without a lawyer present.
“It was a shock,” he said.
He was kept in solitary confinement for 35 days and interrogated daily. He was confused. He could not call his wife. He pleaded to be allowed to get help from Nissan. Little did he know, he said, that Nissan was behind the arrest.
LIFE ON BAIL
To pass the time as he awaits a verdict, Kelly takes long walks with his wife, who moved to Japan in January 2019 on a student visa, taking Japanese language courses to be near her husband.
Kelly says he is lucky to have Dee, his college sweetheart from their days at Augustana College in Rock Island, Illinois.
She was at his trial, giving her husband a thumbs-up as he walked into the courtroom with his lawyers. Sitting in the front row, she took copious notes since court transcripts are only in Japanese.
Dee Kelly said she was taking a walk near the couple’s home in November 2018, when she heard a radio report about the arrest of Ghosn and “an American executive.”
“You feel like you can’t breathe,” she said, not knowing what could have happened to her husband while on a business trip. At home, Japanese reporters were already showing up at her door.
“You work all your life so you can have time during retirement to spend with your kids, and we really wanted to play a big part in our grandkids’ lives, and that was taken,” she said of the events that have unfolded since. “What was done to him is beyond terrible.”
Kelly dedicated his life to Nissan, she said. “To have him treated like this, especially by people that were your friends. That’s really hard.”
THE CASE
Unknown except to several top Nissan officials, Ghosn’s salary was slashed from about 2 billion yen ($20 million) to 1 billion yen ($10 million) in fiscal 2009, when the disclosure of individual executive pay became required in Japan.
Prosecutors contend there was an elaborate plan to make up for the pay cut, which should have been documented in Nissan’s annual securities report.
At trial, they presented as evidence tables on Ghosn’s unpaid salary, kept meticulously by another Nissan official. Kelly says he didn’t know about the tables.
From Ghosn’s native Lebanon, the auto magnate-turned-international fugitive has denied accusations of underreporting his compensation and misusing company funds, contending he was the victim of a corporate coup linked to a decline in Nissan’s financial performance as the Japanese automaker resisted losing autonomy to French partner Renault.
In an AP interview in May, Ghosn mounted a robust defense of Kelly, saying: “Obviously he is innocent.”
“Some observers think that Kelly may be a bit of a pawn in the (Japanese) government’s effort to salvage its reputation after Ghosn escaped,” said Carl Tobias, Williams Chair in Law at the University of Richmond. “In the end, there may be no winners in this sordid story.”
THE ALLIANCE BACKDROP
Yoichi Kitamura, Kelly’s chief attorney, says that in his 43 years as a defense lawyer, he has never encountered a case like the one against Kelly.
“There is absolutely no evidence,” Kitamura said, adding there was no motive either. “Nissan and the prosecutors got together and concocted this into a criminal case.”
Kelly was just trying to do what he thought was best for Nissan, Kitamura added.
Hari Nada, who worked with Kelly in Nissan human resources, went to prosecutors about Ghosn’s unpaid compensation, according to Nada’s testimony in Kelly’s trial. Nada is one of two Nissan officials who got a plea bargain to avoid prosecution.
Kelly says he may have been singled out because he, like Ghosn, supported a merger for Nissan and Renault, to strengthen the alliance in a way he thought would make the companies more equal yet remain competitive.
Nada, former Nissan Chief Executive Hiroto Saikawa and several other Japanese executives opposed the merger, according to court testimony.
“It was a small group that put together this scenario,” Kelly said of his and Ghosn’s arrests.
KELLY’S BROTHERS
John and Dave Kelly, Greg Kelly’s brothers, were at the Chicago Auto Show last month, with cousins, spouses and friends all wearing “Free Greg Kelly” hats and T-shirts, to picket and hand out leaflets.
“To commit a crime, you have to have a motive. Greg didn’t get anything. He was trying to help Nissan,” Dave Kelly, a petroleum engineer who lives in Lafayette, Louisiana, said in a telephone interview.
“He was just doing his job.”
The brothers grew up playing baseball and football in their backyard together.
“He was always an honest guy. He was always someone you could trust and talk to,” said John Kelly, a general surgeon in Oneida, New York.
“I know my brother. I know he will never be involved in anything dishonest.”
Byline: By YURI KAGEYAMA
Follow Yuri Kageyama on Twitter at https://twitter.com/yurikageyama
