Photo/IllutrationCarlos Ghosn, former chairman of Nissan Motor Co. (AP file photo)

The Tokyo District Court on Dec. 20 rejected prosecutors’ request to extend the detention period of Carlos Ghosn, the former chairman of Nissan Motor Co. who is accused of financial irregularities.

The court also denied the detention extension request for Greg Kelly, a former representative board member of Nissan.

While prosecutors are expected to appeal the decision, lawyers for Ghosn and Kelly are expected to submit a request with the district court seeking their release on bail.

Ghosn, 64, and Kelly, 62, who have been indicted on charges of violating the Financial Instruments and Exchange Law, have been detained since their initial arrest on Nov. 19 on suspicion of under-reporting Ghosn’s annual remuneration over the five-year period between fiscal 2010 and 2014.

The two were re-arrested on Dec. 10 on suspicion of under-reporting Ghosn’s remuneration between fiscal 2015 and 2017. The following day, the Tokyo District Court allowed for an additional 10-day detention period that expires on Dec. 20.

Including the re-arrest suspicion, the two are alleged to have under-reported a total of 9.1 billion yen ($81 million) over the eight-year period.

Ghosn has consistently insisted that the unreported income was meant as a deferred payment and did not require inclusion in Nissan's annual securities reports because no final decision had been made within the company about how the money would be distributed, sources said.