Bloomberg News

Carlos Ghosn, the former Nissan Motor Co.  (NSANY)  chairman now being held on fraud charges in Japan, told a Tokyo court Tuesday that the charges of financial misconduct against him were "meritless and unsubstantiated".

In the first public appearance since his arrest on November 19, the 64-year old Ghosn asked the Tokyo District Court to explain the reason for his extended detention on charges that he under-reported income linked to his role as Nissan chairman and moved personal investment losses onto Japan's second-largest carmaker. He is scheduled to be held until at least January 11, but is likely to remain in jail for several months before he faces a formal trial.

"I have been wrongly accused and unfairly detained based on meritless and unsubstantiated accusations," Ghosn said in a prepared statement. "I believe strongly that in all of my efforts on behalf of the company, I have acted honorably, legally and with the knowledge and approval of the appropriate executives inside the company."

Renault SA (RNLSY) shares were marked 1.18% higher by mid-day trading in Paris and changing hands at €55.11 each, but are still some 14.5 % lower since Ghosn, who remains chairman and CEO, was arrested in November. 

"Mr. Ghosn, temporarily incapacitated, remains Chairman and Chief Executive Officer," Renault said in a statement. "During this period, the board will meet on a regular basis under the chairmanship of the lead independent director."

Japan's Kyodo newspaper reported Wednesday that Ghosn, who was stopped by police as he entered Japan for a series of meetings, will be detained for ten days while authorities investigate allegations that the 64-year old misstated income from his role as Nissan chairman and mis-used company funds an investigation in cooperation with Japan's Public Prosecutors Office.

Renault owns 43% of Nissan, which sells far more cars each year, and only has a 15% sake in the French -- equal to that of the French government -- in return. And while Japan's chief cabinet secretary, Yoshihide Suga, has said that it's important to maintain the alliance, some investors are wondering if Nissan may wish to extract itself from the tie-up in order to unlock some of the value trapped in the Ghson-led arrangement.

Ghosn stepped down from his role as CEO of Nissan last year as the 64-year old began paring back his position as the world's most visible auto executive amid escalating tensions with the French government, which owns a 15% stake in Renault, and shareholder pressure to either merge its alliance with Nissan or deepen ties between the two auotmakers and Mitsubishi.

His 2017 payout, which included €7.4 million from Renault and €9.2 million over his final year at the helm of Nissan, was also approved following a 56% to 43% vote by shareholders even as the French government, which owns a 15% stake, rejected the compensation plan.

Ghosn won backing for another four-year term at the held of the Renault board in June, and told La Figaro newspaper in Paris that a plan for the future of the three-way alliance would be revealed "well before the end of my term, or even rather at the start."