New York’s largest carmakers have been accused of helping a sugar daddy to launder billions of dollars in cash that he allegedly funneled to them to fund lavish luxury car projects.
The suits were filed in the US district court for the Southern District of New York on Thursday against four companies – Nissan Motor, Fiat Chrysler Automobiles, Mitsubishis Motor Corporation and Subaru.
The firms have been linked to the $1.6 billion deal struck in 2009 between the United States government and the Italian company to build a new supercar for the US market, which ended up being a Nissan GT-R.
The deal was worth $1bn to Mitsubashis.
Under the deal, the American firm would lease a portion of the car to Mitsobashi for about $4.8bn.
The government would pay the rest, about $3bn, to Mitssubishi, which would then sell the car.
In return, Mitssubishis would pay for parts, design, manufacturing, and other services.
The deal came as a result of the Obama administration’s 2009 stimulus package, which created incentives for automakers to sell their cars overseas, a move that helped boost the fortunes of Mitsubashi.
At the time, Mitsobashis was struggling financially, which meant it had to borrow money to finance its business ventures, according to the suits.
Mitsubishi has denied any wrongdoing and said the deal was a “once-in-a-lifetime opportunity” to expand its presence in the United-States market.
“We do not agree with the allegations that Mitsubanis or any of our business partners helped to conceal the nature of Mitsobanis and Mitsabushis payments,” the company said in a statement.
“The allegations against Mitsubans and Mitsasbuses are entirely unfounded.”
The suit also said that the deals had nothing to do with the auto industry or the auto sector.
“They were never about Mitsubakis car, but about the United Auto Workers (UAW), who were trying to make a deal with Mitsubas,” the suit said.
The Nissan deal was the largest single payment to the US government under the stimulus package.
The government paid Mitsuboshis for about 2.6% of the new GT-Rs that Mitsoboshis had purchased from the Japanese company.
The other three firms were also named in the suit, with Mitsubsashi listed as the “sole shareholder” and Fiat Chrysler as “sole director”.
Mitsubsashi’s bankruptcy filing in March said it had been unable to make payments on $1 billion of debt and that it was “fully cooperating” with the investigations.
“In light of these allegations, Mitsubshas decision to close its UAW car business and to divest itself of its auto arm was made, and the decision was made in good faith, Mitsuba said in the filing.”
Mitsubi will continue to conduct business with Mitsobishi and Mitsuba in good standing and continue to comply with all applicable laws,” it added.
The suit was filed by the National Consumer Law Center, a group that advocates for consumers, and a group of plaintiffs including former Nissan workers, the National Automobile Dealers Association, the union representing the company’s auto workers, and others.
Nissan has denied wrongdoing.”
Nissan Motor Co, Fiat and Mitsubsubishi will vigorously defend themselves against these frivolous and baseless allegations and will vigorously vigorously defend all of their employees against these baseless claims,” a spokesman said.”
Our company is committed to creating a safe, secure and competitive global auto industry, and we intend to continue doing so.
“The plaintiffs are represented by the law firm WilmerHale, which has worked on cases involving Volkswagen, General Motors and other large carmakers.
WilmerHalkon, a division of Wilmer Hale & Loeb LLP, is known for representing companies including the National Football League, US Postal Service and US Airways.