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Ghosn to reimburse Versailles palace for 2016 wedding costs

Feb 08 2019 14:09
Ania Nussbaum, Bloomberg

Carlos Ghosn plans to pay back the Chateau de Versailles for costs related to his Marie Antoinette-themed wedding party after Renault SA disclosed that its former chair may have improperly used a sponsorship deal to host the event.

Ghosn will reimburse the palace, which will in turn compensate the French carmaker, a spokesperson for his family, Devon Spurgeon, said by phone Friday.

The response came a day after Renault said it would tell French authorities that the jailed executive had received a "personal benefit" worth $57 000 related to an agreement with the chateau.

The finding was part of an internal probe and marked the first time Renault has disclosed possible improprieties by Ghosn, who remains in a Tokyo jail after allegations of financial crimes were brought against him by Japanese prosecutors.

The sum is said to be the estimated cost of renting the historic premises under a contract signed by Ghosn that entitled the carmaker to hold corporate events at Versailles.

He and his wife Carole threw an extravagant party there in 2016 that was captured in a photo spread showing actors in period costumes, along with eye-popping arrays of cakes.

Ghosn's quick decision to pay back the chateau contrasts with his stance in Japan, where he has rejected prosecutor claims of financial wrongdoing related to his time at the helm of Renault partner Nissan.

In his first Tokyo court appearance last month, he said he was "wrongly accused and unfairly detained based on meritless and unsubstantiated accusations". He painted the picture of a loyal company man who wouldn’t dream of harming the firm.

After his November 19 arrest, Ghosn was quickly ousted by Nissan and Mitsubishi Motors, the other Japanese partner in the alliance. He resigned last month as chair and CEO of Renault, in which the French state is the most powerful shareholder. His downfall has triggered tension within the car-making pact, partly because Nissan moved fast to remove him while Renault dragged its feet.

Lavish lifestyle

The Versailles party has been widely held up as evidence of the executive's lavish lifestyle when he headed the three global car companies. Before his decision to pay back the Versailles palace was made public, his lawyer in France, Jean-Yves Le Borgne, had said in an emailed statement Ghosn paid for all his wedding expenses.

"The event space at Versailles was made available to him without charge and Mr. Ghosn was unaware that the use of the space would be charged against Renault's allotted usage," he wrote in the email.

Renault started an internal probe in November, shortly after Ghosn was arrested. Following the Versailles revelations, French Finance Minister Bruno Le Maire said the investigation is “starting to get results.”

The minister also said an audit would begin in the coming days of the finances of RNBV, the Dutch company that manages Renault and Nissan's alliance. Already, the companies are reviewing fees paid to consultants by the company, which amounted to about $10m to $20m a year.

carlos ghosn  |  france  |  japan  |  industrial  |  nissan
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