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THE BROAD VIEW

The price of freedom is evaporating Ghosn's wealth

The tab that fellow famous fugitive Jho Low has run up has withering sums on it - big enough to put pressure on Ghosn

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Going by the Bloomberg Billionaires Index, Ghosn's fortune has shrunk by 40% to US$70 million from having to forfeit his bail money and to pay for the cost of his flight to Istanbul. The escape would also have taken half a year of planning by up to 25 people, said a private security expert.

LIFE on the run is proving expensive for Carlos Ghosn. The cost of his escape included US$14 million in forfeited bail money, and the operation that enabled him to celebrate new year's eve in Beirut could have cost US$15 million or more.

That includes US$350,000 for the private jet that spirited the former auto executive from Osaka to Istanbul and millions of dollars for his multi-country extraction that would have taken a team of as many as 25 people half a year to plan, said a private security expert who said he wasn't involved and asked not to be identified, given the nature of the operation.

Such outflows have seen Ghosn's fortune shrink by 40 per cent since he was arrested more than a year ago at Tokyo's Haneda Airport, according to estimates by the Bloomberg Billionaires Index. His fortune is now calculated to be about US$70 million, down from around US$120 million at the time of his first court appearance a year ago.

In fiery, freewheeling form at a 21/2-hour press conference in Beirut on Wednesday, the 65-year-old repeatedly proclaimed his innocence against allegations that he understated his income and raided corporate resources for personal gain; he also accused Japanese prosecutors, government officials and Nissan Motor Co executives of conspiring to topple him, and insisted he would clear his name.

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"I am used to what you call mission impossible," he said in response to questions from the assembled reporters. "You can expect me in the next weeks to take some initiatives to tell you how I'm going to clear my name." That might include a tell-all book.

Ghosn plans to publish the story of his arrest, Japanese public broadcaster NHK reported.

His downfall has already lost him millions in payouts. Last year, Nissan cancelled his retirement and stock-linked compensation; Renault said he won't benefit from a non-compete agreement he signed in 2015 and stock-based payments that were conditional on his staying at the company. Many of the charges against him centre on retirement payments, totalling more than US$140 million, which he hadn't yet received.

French investigations

That may be just the start. French investigations examining his alleged misuse of Renault's money to host lavish parties and pay consulting fees are at a preliminary stage. The former auto executive was already hit with a US$1 million penalty under a September settlement with the US Securities and Exchange Commission (SEC) for failing to disclose the retirement payments.

At his press conference, he claimed he had done nothing untoward in hosting an event at the Palace of Versailles. Regarding the SEC fine, Ghosn's lawyers had said previously: "We are pleased to have resolved this matter in the US with no findings or admission of wrongdoing."

Ghosn's US law firm, Paul Weiss Rifkind Wharton & Garrison LLP, declined to comment on Bloomberg's wealth estimates or on the SEC settlement. Ghosn's Lebanese lawyer also declined to comment.

Nissan is looking at bringing legal action against him in Lebanon, people familiar with the company's plans said; this is an attempt to recover the money it claims he used improperly. The carmaker is trying to evict him from the pink villa in Beirut to which he still has access. Nissan purchased it for US$8.75 million, renovated it and furnished it for him, according to a person familiar with the matter.

"Ghosn's flight will not affect Nissan's basic policy of holding him responsible for the serious misconduct uncovered by the internal investigation," the Yokohama-based automaker said on Tuesday.

The authorities may be looking to seize some of his assets. In Switzerland, where Ghosn reportedly banks with Julius Baer Group, the Swiss authorities received a legal-aid request from the Tokyo District Attorney's Office a year ago, said a spokesman for the agency that received the notice. It examined the request before forwarding it to the Zurich prosecutor's office in March. A spokesman for the Zurich prosecutor's office declined comment on the nature of the request or what they are doing with it.

At Japan's request, Interpol issued a so-called Red Notice in Ghosn's name, making it known to other law enforcement authorities that the country considers him a fugitive. Lebanese prosecutors issued a travel ban for him and asked him to hand in his French passport after the notice was issued, the Associated Press reported.

It is not clear if any of his assets have been seized. In criminal court cases in Japan, a defendant's assets cannot be frozen or confiscated until a court verdict is reached, said Taichi Yoshikai, a law professor at Kokushikan University. There are exceptions in civil cases, but it is unclear how this will be applied when a defendant is overseas, he said.

World's most famous runaway

The Tokyo District Public Prosecutors Office, which rarely makes public comments, posted an English-language statement on its website on Thursday, saying Ghosn had only himself to blame for his strict bail conditions. It vowed to bring him to justice in Japan. Justice Minister Masako Mori said Ghosn had been "propagating both within Japan and internationally false information on Japan's legal system and its practice". Renault declined to comment.

Bloomberg's calculation of Ghosn's net worth assumes none of his assets at the time of his arrest - which included shares in Renault and Nissan now valued at about US$60 million - have been seized or sold.

Even if that is the case, the costs that come with being the world's most famous runaway will continue to be formidable. Legal bills for fugitive Malaysian financier Jho Low came to US$15 million, according to an October deal with US federal prosecutors. Efforts to burnish Low's reputation cost US$1.1 million over seven months, The New York Times reported. Such expenses are likely sizeable enough to pressure even a fortune as large as that of the Ghosn family. Still, some costs may be lower than expected. The US$350,000 tab for his Osaka-to-Istanbul flight was to be paid in two tranches. The charter company has so far received only the first half. BLOOMBERG