U.S. attorney for Nissans Kelly asserts his innocence
TOKYO -- The attorney for the Nissan director branded the “mastermind” of former Chairman Carlos Ghosn’s alleged financial misconduct says his client did nothing wrong.
Greg Kelly, who was arrested with Ghosn on Nov. 19, is currently being held in cramped Tokyo jail cell. The detentions of both men were extended for another 10 days from Dec. 1, giving prosecutors more time to seek evidence from Nissan and interrogate both Ghosn and Kelly.
Neither man has been officially charged.
“Mr. Kelly takes the position that everything that he did was legal, it was authorized, it was appropriate, and he’s violated no laws,” said Aubrey Harwell, a Nashville, Tennessee lawyer working with an attorney in Japan to free Kelly. “He did nothing wrong.”
Harwell’s Japanese counterpart, Yoichi Kitamura, has also said Kelly maintains his innocence.
Harwell confirmed that Ghosn has tapped U.S.-based law firm Paul, Weiss, Rifkind, Wharton & Garrison. In Japan, Ghosn is also represented by high-profile defense attorney Motonaru Ohtsuru.
The legal teams of Kelly and Ghosn are communicating about their cases, Harwell said by phone.
Japanese media reports have said Ghosn has asserted his own innocence by telling investigators that he ordered Kelly to conduct the financial transactions under scrutiny in a legal way.
Harwell said it was unlikely that Ghosn would try to scapegoat Kelly by shifting blame to him.
“I guess that’s possible. But my judgment is that’s highly unlikely in this situation,” Harwell said. “Based on what I know, neither of these people did anything criminal.”
Harwell said he has not yet been able to travel to Japan or have contact directly with Kelly. “We don’t even know what the specific charges are,” he added.
Prosecutors have not yet outlined a possible case against the men in an official indictment.
An internal Nissan investigation claims Ghosn under-reported his compensation to the tune of 9 billion yen ($80 million) over eight years starting in 2009. Kelly, it alleges, helped Ghosn hide the amount as deferred compensation to be paid at a later date, such as after Ghosn retired.
Nissan’s account also alleges that both men conspired to use Nissan funds to pay for homes and apartments around the world for Ghosn’s exclusive use.
Most suspects in Japan can be detained for up to 23 days without a formal charge. In the case of Ghosn and Kelly, both can be detained for up to 22 days because they were arrested directly by prosecutors and not first police. During that period, they can be subjected to lengthy interrogations – often hours every day – in the absence of their lawyers. Prosecutors may sometimes also bring new allegations to “re-arrest” the suspect and start the cycle over again.
The Kosuge detention center in northeast Tokyo where Kelly and Ghosn are being held is known for being bone-chilling in winter and sweltering in summer.
Most cells are about 7 feet by 7 feet and have a solid door with a window through which guards can monitor inmates, according to defense attorneys familiar with the facility. Suspects sleep on futon mattresses and have a privacy screen they can pull for partial cover when using the toilet.
They are allowed to shower two or three times a week.
Kelly has not had contact with family members, Harwell said. “We are told he is holding up reasonably well,” Harwell said.
Harwell said Kelly, 62, was picked up at a Tokyo airport where he landed aboard a private jet. He and Ghosn were traveling separately. Ghosn, 64, was arrested at Tokyo’s Haneda airport.
Kelly maintains his position as a director on Nissan’s board, although CEO Hiroto Saikawa, 65, is recommending that shareholders remove him. Nissan is considering an extraordinary shareholders’ meeting as early as January to vote on removing Kelly and Ghosn from the board.
After their arrests, Saikawa lashed out at Kelly as the “mastermind” of the alleged misconduct.
Kelly joined Nissan North American Inc. in 1988 as senior manager and associate legal counsel. Prior to joining Nissan, Kelly was an attorney for Barnes & Thornburg, a law firm.
He became director of human resources for Nissan in August 1993 and Nissans senior director of human resources in April 2000. Kelly was nominated for the companys board in June 2012, making him the first American board member for the Japanese automaker.
At the time, Nissan had four non-Japanese executives on its nine-member board.
One of those board members was Carlos Tavares, who is Portuguese. Tavares left Nissan in 2014 and is now head of Renaults French rival, PSA Group.