PARIS -- Renault has alerted French prosecutors to payments made by former head Carlos Ghosn to a Renault-Nissan distributor in Oman following reports that the money may have been used to repay personal debt, according to people familiar with the matter.
The payments totaled millions of euros, said the people, who asked not to be named because the information is not public.
French newspaper Le Figaro reported earlier that Renault paid the Oman-based distributor through a special cost center overseen by Ghosn rather than through marketing and sales divisions. The information was provided to Renault by partner Nissan, the newspaper said.
Reuters also cited sources saying that Renault has alerted French prosecutors to the payments.
The move by Renault follows reports over the past months about Nissan's relationship with Suhail Bahwan Automobiles, which has been its exclusive distributor in Oman since 2004. An internal probe by Nissan into its finances raised questions around the company, a source said.
In January, Japanese newspaper Nikkei reported that Ghosn paid $32 million and $16 million to Nissan suppliers run by two acquaintances in Oman and Lebanon. The payments were made from the cash reserve at the center of breach of trust allegations against Ghosn
'CEO reserve' fund
Tokyo prosecutors suspected Ghosn may have used Nissan's "CEO reserve" fund for personal purposes, Nikkei said.
French magazine L’Express has reported that Japanese prosecutors were investigating the possibility that Ghosn borrowed $30 million from billionaire Bahwan, based on a document that was found in Ghosn’s apartment in Japan. A Suhail Bahwan spokesperson could not be reached for immediate comment.
Ghosn denied the allegations through his family. "We strongly deny allegations of wrongdoing in Oman,” a spokesman for the Ghosn family said by phone.
Responding last month to earlier reports about the Nissan payments via SBA, a Ghosn family spokesman said: "The dealer incentive payments were directed by regional heads, not the CEO, and rewarded top performing dealers around the world."
Renault declined to comment.
Ghosn’s Paris-based lawyer, Jean-Yves Le Borgne, said he was not aware of Renault reporting any payments to the French prosecutor. An Oman-based Nissan supplier had received bonuses that were related to its performance, he said.
A spokeswoman for the French prosecutor’s office said Renault on March 29 added many documents in support of an ongoing investigation, but she declined to provide details.
The Oman payments mark the second time Renault has signaled possible wrongdoing by Ghosn to authorities. In February, Renault disclosed Ghosn may have improperly used a sponsorship deal to host a party at the Palace of Versailles. Ghosn's family has said he would reimburse 50,000 euros ($56,000) to the palace. The investigation is still ongoing, according to the prosecutor's office.
Renault is carrying out an internal probe into its finances and the pay of top managers following Ghosn’s arrest in November. Ghosn has denied charges in Japan that he improperly used Nissan company funds. Renault and Nissan also began a joint audit of the Dutch company that oversees their partnership, RNBV.
Four jets
The Renault probe also found that Ghosn had the use of four jets owned by RNBV, one of the people said, adding that this hasn’t been flagged to authorities. Ghosn was arrested in Japan after landing in Tokyo on one of the airplanes.
Ghosn is awaiting trial in Japan on charges that he failed to report $82 million in Nissan pay he had arranged to receive after retirement. He has also been indicted for transferring personal investment losses to Nissan and steering $14.7 million in company funds to Saudi businessman Khaled Al-Juffali.
Renault initially sought to avoid being drawn into the investigation initiated by Nissan - which ousted Ghosn as chairman days after his arrest - and for weeks avoided sharing the Japanese partner's findings with its own board. But the alleged Oman connection may deepen Renault's exposure to the scandal unearthed by its Japanese partner, which has strained their 20-year-old alliance, and raise new questions about governance at the French parent company.
Ghosn was eventually forced out as Renault chairman and CEO in January, when Michelin veteran Jean-Dominique Senard was appointed chairman, and the alliance partners embarked on an independent audit of their joint finances the following month.
Reuters and Bloomberg contributed to this report
