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The Madmen Who Took Over the Mental Hospital: The story of Carlos Ghosn


Continue the story

In this article, we will continue the life story of Carlos Ghosn, one of the most successful CEOs in the world.


You can access the first part of the story from the link below;



The Crazy People Who Take Over the Mental Hospital...

Renault & Nissan & Successful CEO of Mitsubishi Alliance, Carlos Ghosn, is detained in Japan on November 19, 2018.


Carlos Ghosn, who was 65 years old at the time, lost his confidence in Japanese justice after a while and believed that he would end his life innocently in Japanese prisons.


Carlos Ghosn, who was making preparations for the merger of Nissan under Renault, became the victim of a plan initiated months ago by Nissan, which did not want this union, and his life changed irreversibly.


Although he himself had major mistakes in the process, this process would not benefit any of the parties.



Carlos Ghosn Side - Root Cause: Discomfort About His Income

Although Carlos Ghosn was the highest-paid person in Japan, he saw that he was paid much less when comparing himself with the world's leading automakers. Because Ghosn was trying to make Nissan a large company not only in Japan, but worldwide. And he was quite successful in this, as everyone admitted.


In Ghosn's words, it was not easily acceptable for a large company in a prideful country like Japan to have a foreigner come and save them. They did this not willingly, but out of necessity.


Although Carlos Ghosn received an offer from GM, he did not find it right to leave Nissan, which was struggling with serious problems, and had to reject the offer.


Ghosn had brought the Alliance to such a point that Renault & Nissan & As if the Mitsubishi partnership was not enough, he dreamed of adding Fiat Chrysler to this Alliance and being at the head of an Alliance where 14+ million vehicles are produced annually. Being a kind of Global CEO...


But despite this, the fact that he was not paid as much as the CEOs who managed a single company around the world and managed a much more complex structure than them was wearing him out.


Ghosn's financial sources of income

  • Chairman of Nissan

  • Chairman and CEO of Renault

  • Chairman of Mitsubishi

Thus, his annual income reached 10-15 million dollars. As such, he was the highest-paid person in Japan. But he was low compared to other CEOs in the Fortune 500.

Average CEO Salaries

Carlos Ghosn constantly argued that the salary he received was low. Alliance members were also afraid of Ghosn's criticism and worried that Ghosn could leave his post at any time.


Alliance members were trying to make Ghosn happy by compensating for his criticism from different areas. At this point, Greg Kelly's role is thought to be [#20].


Ghosn sought to be the biggest and the best. And that was the beginning of the end.



Root Reason on Nissan Side: Transformation of Alliance into Merger

Although French State's share [SO1] Although Nissan's share is the same, The law enacted in 2015[SO2 Although ] gave 2 voting rights to the French State, Nissan did not have any voting rights.

Renault and Nissan Partnership Rates

According to Ghosn, the first discomfort on Nissan's side started at this point.


By 2018, Nissan, realizing that Renault would now evolve into Merger, believed that the way to prevent this was to get rid of Ghosn.

Plan to Bring Renault and Nissan Under the Same Umbrella

They are trying to prevent the Alliance from falling into Merger, including the last day when Carlos Ghosn was captured, but when they realize that they are at a point of no return, they are forced to take action through Ghosn.



Power Poisoning and Change in Carlos Ghosn

Carlos Ghosn began to experience changes in different areas over time, from his clothing to his family. He seemed to have some kind of power poisoning.


Carlos Ghosn remained at the head of this union for so long that he began to see himself as bigger than this union and even felt like it was his own. In fact, he was doing all these unconsciously, thinking that he had the right to do so.


The birthday celebration at the Versailes palace was the final nail in his coffin.



Accusations Against Him

The accusations against Ghosn were mainly based on his failure to report his income between 2011 and 2018 and the fact that an amount of approximately 5 million USD was taken from Nissan and transferred to his family companies. In fact, he reported his income between 2011 and 2018 by consulting his own Japanese advisors.


Hari Nada is believed to be the key person in the lawsuit against Carlos Ghosn [#20].


In Andy Palmer's words, for successful leaders who devote their whole lives to their work, Personal and Legal domains sometimes intertwine. This meant that sometimes there was confusion as to which expense belonged to the business and which expense belonged to the private sector.


For example, he uses Nissan's plane for his private trips and holidays. And he saw this as his right because he was not given a salary increase.


Similarly, some of the houses he lived in also belonged to the company. These included a luxury residence in Hawaii. Additionally, a yacht was purchased for the company. In his own words, he said, "These do not belong to me, they ultimately belong to the company." But it was never welcomed that the company used its financial power for its own luxurious life.


He crossed the line so much that he celebrated his Marie Antoinette-themed birthday with his family at the Palace of Versailles. Against this accusation, he argued that this was actually a celebration of the 30th anniversary of the Alliance and coincided with his 60th birthday. However, no one from either Renault or Nissan went to that celebration.


The stress on Nissan's side was increasing day by day. Ghosn's management style seemed to be more dictatorial. Over time, it began to lose its initial image. It was thought that he no longer deserved his old power.


On top of all this, the main stress point on the Japanese side was that it wanted to fully merge Renault and Nissan, which in a sense meant Renault's complete dominance of Nissan. His aim was to increase the French power in Nissan and Mitsubishi as much as possible. This increased the tension especially within Nissan day by day.


And ultimately, it paved the way for his capture in 2018.



Collection of Evidence

During the collection of evidence for the "Kali 10 Compensation Investigation Report" in the case filed against Ghosn, he disguised himself with the code name "Nectarine" and worked hand in hand with Ghosn. Hari Nada played the critical role [#20]. Stating that he was threatened by prosecutors to provide evidence, Hari Nada, in a way, sold out his boss to protect himself.


He is worried that if Renault and Nissan go through a full merger (Merger), as Ghosn has been planning for years, he will not be promoted like other employees at Renault. Hari Nada was seen by Nissan's top executives as the key person to prevent this merger.


Hari Nada, who made a deal with both prosecutors and Nissan officials, fit the profile of someone who sold out his boss for his own future. But eventually, instead of promotion, he was demoted and put on passive duty.


Ghosn believes that this conspiracy against him was planned and put into action at least 12 months in advance. Judging by Hari Nada's statements, this period seems even longer.


The evidence collection process leading to Carlos Ghosn's capture is detailed in the article below;



Carlos Ghosn's Capture and Detention Process

Ghosn, who was completely unaware of the investigation against him, was detained by police forces who entered his plane as soon as he landed at Tokyo Airport on November 19, 2018, with his Golfstream G150 private plane number N155AN [#10].


When he was taken into custody, he was interrogated without his lawyer.


After being detained for approximately 108 days, he was released under the following conditions and a certain bail;

  • He cannot leave the country

  • He will be under constant official surveillance

  • -- He will be monitored by cameras in the hotel where he is located

  • -- 2 Officers will follow him physically at all times

  • Except for custom control [SO3] Cannot use the Internet


15+ Years [SO4] imprisonment was requested. In his words, “They will leave me there until I die[SO5] ” it said


On November 19, 2018, the day Ghosn was captured, although Nissan had search warrants only for Ghosn's campuses in Japan, his campuses in other countries were also entered as a "Nissan Official". All his documents, computers and hard disks were collected at the entered locations.



Greg Kelly

Although it was not covered long in the media, Ghosn and Greg Kelly were arrested in Japan because they were held responsible for underreporting Ghosn's income. Kelly had been with Nissan for over 30 years [#06].


His inclusion in the subject is as follows; Like Ghosn, he is also invited to Japan. A visit to Japan is put on his calendar by his manager's assistant. Since he does not understand why this is happening, he calls Hari Nada and asks. Although Kelly says that he needs neck fusion surgery and that this meeting can be held online, Hari Nada insists that he come. He even says that a charter flight will be arranged for him, not a scheduled one. Kelly obliges and leaves. As soon as you get off the plane, you are picked up by a minibus. On the road, the vehicle is blocked and taken into custody by law enforcement officers. A 3-day trip turns into 3.5 years of prison life [#06].


His family learned about Kelly's capture when they heard the news on the radio that "Carlos Ghosn and a Maerikan citizen were captured" [#06]. He later learns that Kelly Ghosn is also in the same detention center [#06].


Greg Kelly spends 37 days in the detention center with very poor conditions and is interrogated for hours every day for 32 days [#06].


At the end of the 37th day, he is put under house arrest on bail. He stays there with his wife until the case is concluded [#06].


Although such cases are completed within 2 years in Japan, Kelly's case did not even start for 2 years [#06].


Greg Kelly is being released on March 3, 2022.


According to Greg Kelly, Nissan officials were against Merger from the very beginning. And a significant number of senior executives felt that Carlos Ghosn was essentially damaging the Alliance [#06].


According to the information provided by Greg Kelly, a group of mid-level managers at Nissan Japan expressed their discomfort with Ghosn in a very limited group about 3 years ago and took action. They based the idea of salvation on Ghosn's departure and collected evidence for this and contacted prosecutors [#06].


According to Greg Kelly, losing someone like Carlos Ghosn was not in Nissan's best interest. Using such a man even as a consultant had serious advantages in terms of Nissan's contact with the environment, future plans and organizational capability development. In fact, having Carlos Ghosn as a spokesperson for Nissan was extremely valuable for Nissan. But Nissan did not do these things and chose to fight it [#07].


From the first day until the day he was released, even though he did not understand the Japanese system and was afraid, Greg Kelly believed that he would be released because the case did not involve a crime [#07].


After Greg Kelly was released, he and his wife went on a trip of about a year in his car. They meet with the people who supported them on this trip and express their gratitude. And he even has the opportunity to see his 2.5-year-old grandchild, who was born while he was in custody, during this trip [#07].


Greg Kelly, who summarizes the events he experienced with the word "Tragic", does not plan to return to the automotive industry again.


Greg Kelly, who has great respect for Carlos Ghosn even today, is preparing a book about his years with Nissan [#07].



Escape Plan

For someone who was 64 years old (b:1954) in 2018, staying in prison for 15+ years meant ending his life there.


Ghosn was in complete despair. He believed that there would be no fair trial in Japan. Because even the first interrogation was not done in the presence of a lawyer. And he was forced to escape.


For this reason, he started looking for someone who could secretly smuggle him out of the country illegally.


The team, consisting of former police officers and soldiers, worked on the vulnerabilities of the airports.


The leader of the team was Michael Taylor, a retired American special forces officer. He moved to Lebanon during the Lebanese civil war, where he met his wife Lamia and developed close relations, especially with the Christian people [#08].


Michael Taylor was the right name for the job.


Micheal Taylor and his team, including his son, came to Japan in '.


Kidnapping someone who was well known throughout the country was a very risky operation. The first thing they found was that the team tracking Carlos Ghosn, who had traces of traveling around Japan, abandoned him immediately after he entered the hotel. This lit a light for the team.


Escape plan activated [SO6] received.

  1. Ghosn started going to the Grand Hyatt hotel regularly. This place had many entrances and exits.

  2. Then he went to Shinagawa station, which is one of Tokyo's main hubs and where you can easily mingle with the public.

  3. Then he went to Osaka, the 2nd largest city in Japan, by high-speed train.

  4. His next stop was Kansai Airport, Osaka's main airport.

  5. Here he entered a large music box.


The reason why Kansai Airport was chosen was that the X-Ray device was too large for the music box to enter.


The plane landed at Istanbul Atatürk Airport after a journey of approximately 12 hours. Here, the representative of the company where the plane was rented transferred him to another plane going to Lünan.


After the incident emerged, Turkey detained 4 pilots and some officials.



Ghosn is in Lebanon

When he escaped from Japan, he had no phone number, email address or any documents with him. He had spoken to all of them.


Ghosn said in a statement, "I ran away from injustice, not justice." He was going to say.


As soon as he arrives, a press conference [SO7] and defended himself.


Japan issues Red Notice about Ghosn[SO8] . However, Lebanon has a structure that does not extradite its citizens. However, these accusations of the Japanese courts could turn into a lawsuit in Lebanon. Ghosn did not raise any objections at this point, on the contrary, he wanted to defend himself in a court he trusted.


The time when Ghosn came to Lebanon coincided with the times when the country was in turmoil. While once he could go anywhere in the world he wanted, now he seemed trapped in a place like Lebanon, which was plagued by internal turmoil and had almost collapsed.


Although Ghosn is a Lebanese citizen and resides in Lebanon, Nissan filed the case file[SO9] Sent to France. It also issued a red notice about him.


Lebanon then confiscated Carlos Ghosn's passport and banned him from leaving Lebanon.


According to Ghosn, the majority of the files in the case were stolen from his office in Lebanon with the organization of Nissan officials.


Due to the court case opened in France, French prosecutors are contacting Ghosn and want to meet him. Ghosn also wants to meet with them and they come together in Lebanon and hold a 3-day meeting in the presence of Lebanese officials. Authorities demand that Ghosn be tried in France, but this required cooperation with Lebanese authorities since Ghosn was tried with a Red Notice. However, just at that time, Ghosn learned that there was a new and secret investigation and arrest warrant against him in a newspaper in America. Just on the eve of the elections in France. Ghosn realized that there was a hidden agenda here and did not agree to a deal [#05].



The Team That Kidnapped Ghosn Is Captured

Upon the red notice issued by Japan, American authorities captured Michael Taylor and his son in May 2020 and handed them over to Japan. While Michael received 2 years in prison, his son received 20 months in prison.


It is thought that Taylor was given 1 million dollars for this work and the payment was made through different channels such as bank transfer and Bitcoin.



Ghosn Files Countersuit

After collecting evidence for a certain period of time, Carlos Ghosn is suing Nissan for a record compensation of $1 Billion [#25].


Ghosn states that even if Nissan gives up its case, it will not go back on its path and will do its best to get its reputation back.


Ghosn accuses 11 people and 3 companies in his lawsuit [#25];

  1. Nissan

  2. Law Firm Latham & Watkins

  3. Phoinos Investments, a subsidiary of Nissan, purchased the house in Beirut



The Situation of the Alliance After the Departure of Carlos Ghosn

After the long-term successful cooperation of Renault and Nissan, and on the eve of Mitsubishi joining this alliance, the Alliance management said that Ghosn's appointment as the head of this union was essential for the healthy process and appointed Ghosn as the head of the union. Thus, this Renault & Nissan & Mitsubishi Alliance became the world's largest automotive group create-post?referralInfo=sidebar&lang=tr#_msocom_10" target="_blank">[SO10] [#05].


But only 4 months later, the said lawsuit was filed [SO11] and Ghosn was let down.


With Ghosn's departure, the Alliance suffered a serious collapse. The biggest reason for this was the loss of trust.



After Ghosn in Nissan

Renault & Nissan partnership experienced a decrease in value of approximately 33 Billion Dollars after this operation [#22].


Nissan management, which changed the important points of the management, established a team with zero or little industry experience, which cannot be compared with the previous one [#22].


In addition, two valuable senior executives at Nissan went to Hyundai and Jeep [#22];

  1. José Muñoz – Hyundai COO

  2. Christian Meunier – Jeep CEO


What is being talked about in the market is that Renault will reduce its share in this partnership from 42% to 15% before Nissan's value decreases further [#22].


Renault has recently been looking for new Chinese partners [#22].



Ghosn's Self-Criticism

Looking back, Ghosn could have founded and developed a company in this field in 2009, when Tesla was just developing in the hands of Elon Musk. It is very likely that he would have been successful, or at least he would not have lived through these days.



In summary...

Burning a quilt for fleas...

I think this move, undertaken by one of the world's most established automotive companies, just to get rid of the CEO of the Alliance it founded, is a wrong operation that has exceeded its purpose beyond its imagination and has not benefited it at all.


Imagine what the company that did this to its CEO, who took Nissan out of bankruptcy, placed it among the leading companies in the world, and made billions of dollars in profit, could do to its other staff and genius stakeholders... Apparently, the huge Nissan could not think of this...


This is also a yellow light for anyone working as an expat in Japan. If the Japanese Government investigates the psychological consequences of this incident, I believe it will encounter reports with very tragic headlines.


The best words explaining the process come from lawyer Ravinder Passi, one of the closest witnesses of the events: "The madmen who took over the mental hospital..." [#23]


As for Ghosn;

Ghosn is currently fighting against Nissan in Lebanon, while continuing his consultancy and other activities. He does not plan to return to the automotive industry as CEO, but says he will continue to support it. He especially says that Lebanon needs support.


Who knows, maybe one day we may see Carlos Ghosn as a minister or Prime Minister in Lebanon...




 

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