Wrongfully dismissed former executives: Renault

Renault said it wrongfully dismissed three executives accused of spying after French prosecutors found no substance in a complaint by the carmaker against the former employees.

Chief Executive Officer Carlos Ghosn and Chief Operating Officer Patrick Pelata plan to meet with the executives, promising compensation for “serious prejudice” to their reputations and careers, Renault said in an e-mailed statement today.

Authorities in Switzerland and Liechtenstein have confirmed that the men didn’t have bank accounts in those countries, as Renault had claimed, for their alleged spying activities, Paris Chief Prosecutor Jean-Claude Marin said today at a press conference. The probe will now shift to looking into possible fraud by another Renault employee, he said.

Renault called an emergency board meeting for 4 pm local time that may lead to sanctions against managers involved in the case, two people familiar with the matter said. Prosecutors yesterday issued “organized fraud” charges against Dominique Gevrey, the security chief whose internal investigation led to the firing of upstream development chief Michel Balthazard and two other executives.

“At this stage we do not know whether we are dealing with just fraud or a deliberate attempt to destabilise Renault,” Marin said. “If there was any espionage it was not carried out through the networks identified by Renault.”

Renault fell as much as ¤2.47, or 6.1 per cent, to ¤38.2 and was down 5.7 per cent as of 4.15 pm in Paris trading. The shares have dropped 12 per cent this year, valuing the automaker at ¤11.4 billion ($15.9 billion).

The board will meet at the carmaker’s headquarters in the Paris suburb of Boulogne-Billancourt, said the people, who declined to be identified because details are confidential.