Where's Carlos? Ghosn to Face Japan's Legal System: QuickTake

(Bloomberg) -- Carlos Ghosn, the deposed chairman of Nissan Motor Co., finds himself in the throes of a legal system renowned for having one of the world’s highest criminal conviction rates. It’s a system with a uniquely Japanese flavor. People can be held without charge for weeks and can only get bail after being indicted. But they can also be simultaneously re-arrested on new charges, allowing prosecutors more time to hold them for questioning. Ghosn’s chances of getting out of jail appeared to improve when a Tokyo court refused to extend his detention on Dec. 20. But prosecutors then re-arrested him on fresh allegations of misconduct, a potentially more serious charge.

1. Where is Ghosn now?

He’s been held at Tokyo’s detention house since his Nov. 19 arrest. The 12-story building, located in Katsushika in the northern part of the city, is one of eight such detention houses in Japan, according to the Ministry of Justice. On Dec. 10, Ghosn was indicted for understating his salary at Nissan during the five years until March 2015. He was also re-arrested on similar charges covering the three fiscal years through March 2018. After a Tokyo district court refused to entertain a plea to extend his jail detention on Dec. 20, prosecutors re-arrested him over an accusation of aggravated breach of trust. The re-arrest means he’ll spend Christmas Day in the detention house, according to Kenichi Kinukawa, a former Tokyo prosecuting attorney who’s now a lawyer in the London office of the Japanese law firm TMI Associates. Ghosn’s lawyers declined to comment on the re-arrest. Ghosn has denied wrongdoing.

2. Why’s he been held so long?

After an arrest, prosecutors can obtain a court order to hold someone for up to 20 days before they must announce whether they’ll indict. A re-arrest starts the detention period anew, according to David T. Johnson, a sociology professor at the University of Hawaii at Manoa who researches the Japanese criminal justice system. The idea of being able to hold suspects for a long time is to use that time to interrogate them and attempt to secure a confession to make a trial easier, Johnson said. There’s no limit to the number of times prosecutors can re-arrest him on new charges, Kinukawa said. Bail isn’t possible until after prosecutors indict, but new charges put that prospect off again for up to 20 more days, says Tsutomu Nakamura, a former public prosecutor who is the founder of Nakamura International Criminal Defense in Tokyo. Objections in other countries to Japan’s extended detention of suspects may have factored into the failure of the request to prolong Ghosn’s time behind bars on Dec. 20, said lawyer Yuichi Kaido, part of a group at the Japan Federation of Bar Associations that seeks to reform the custody system. “I think judges are sensitive to international criticism,” he said.

3. How much longer could he be held?

Quite a long time, in theory. Once the new new detention period ends, Ghosn can apply for bail, but only about 30 percent of bail applications in Japan succeed, Kinukawa said. It usually takes months to bring complex cases such as this to trial once charges have been made -- and in exceptional cases it can take as long as a year, he said. If Ghosn doesn’t get bail, he could be kept in the detention house the whole time. Bail may be granted once the trial starts. Often, Japanese suspects who contest the facts of a case are refused bail on the grounds that they may destroy evidence, Kaido said.

4. What are Ghosn’s rights while he’s under arrest?

Unlike in many other countries’ legal systems, Ghosn won’t necessarily have access to his lawyer during questioning, even if it goes on for weeks. The prosecutors decide whether to allow an attorney to sit in, Johnson says. In practice, when a suspect wants to speak to a lawyer during questioning, prosecutors will suspend the interview and let the suspect do so in a different room rather than allow the attorney into the interview, Kinukawa said.

5. If they prosecute, what punishment could Ghosn face?

Japanese prosecutors rarely risk a not-guilty verdict. “They only prosecute the cases where they’re really, really confident in obtaining a conviction,” Kinukawa said. Fewer than 1 percent of cases in Japan’s district and county courts in 2017 resulted in a not-guilty verdict or the defendant being released, according to prosecution data. Ghosn’s case will likely be handled by a panel of three judges, and not a jury, Kinukawa said, because only a limited set of cases are handled by jury trials. The average trial duration for three-judge cases is 13.3 months, he said, and the judges will likely announce their verdict and any sentence on the final day of trial. Ghosn was charged with breaking the Financial Instruments and Exchange Act and could face a prison sentence of as long as 10 years. The alleged offense, according to the deputy chief prosecutor at the Tokyo District Public Prosecutors Office, is “even more serious than insider trading.” The allegations of breach of trust would be in violation of Japan’s Companies Act and carry a maximum sentence of 10 years in jail and 10 million yen ($90,000) fine.

6. What Tokyo’s detention house like?

Daily life for detainees begins at 7 a.m., with three meals served through the day and lights out at 9 p.m., according to an archived and undated pamphlet from the ministry. Meals include rice, sides of meat and vegetables, and soup. The Tokyo site began operations in the early 1900s and moved to its current location in 1971. The center is normally off-limits to the public, but the grounds open every September for a festival, according to an account on the Japan Visitor website. Attendees are able to sample prison fare such as a curry and bread and buy products made by inmates. The website noted that the festival attracts such large crowds that automakers display car models there for marketing purposes. The detention house is also where Japan executes some of its prisoners on death row. In July, the leader of the Aum Shinrikyo doomsday cult -- the group that carried out a deadly sarin gas attack on the Tokyo metro in 1995 -- was executed, various media reported.

The Reference Shelf

• Ghosn and Nissan are indicted in Japan over pay scandal.
• Fate of world’s biggest car alliance hangs on one word.
• Bloomberg Opinion columnist Joe Nocera says Nissan and Japanese prosecutors may come out of this looking a lot worse than Ghosn.
• Nissan CEO turns on mentor out of “despair.”
• Nissan drama looks a lot like a palace coup, writes Bloomberg Opinion’s David Fickling.
• An archived Ministry of Justice document shows the Tokyo detention house (the document’s no longer displayed on the MOJ website).
• Some photos of the prison festival on the Japan Visitor website.
• An MOJ document in Japanese about the country’s correctional facilities.

--With assistance from Gearoid Reidy, Lena Lee and Paul Geitner.

To contact the reporters on this story: Lisa Du in Tokyo at ldu31@bloomberg.net;Kaye Wiggins in London at kwiggins4@bloomberg.net;Isabel Reynolds in Tokyo at ireynolds1@bloomberg.net

To contact the editors responsible for this story: Kazunori Takada at ktakada17@bloomberg.net, ;Heather Smith at hsmith26@bloomberg.net, Grant Clark, Steve Stroth

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