Moves comes day after court denied prosecutors’ request to extend detention, raising chance of Ghosn going free on bail.

Prosecutors in Japan have rearrested former Nissan chief Carlos Ghosn on new allegations of making the car giant shoulder millions of dollars in personal investment losses, dashing chances he would soon be released on bail.

The dramatic turn of events on Friday comes a day after a court in the capital, Tokyo, unexpectedly denied a prosecutors’ request to extend Ghosn’s detention, which raised the possibility that he could go free on bail as early as Friday.

The rearrest means he could be held for at least another 10 days in a Tokyo jail, where he has been confined to since he was arrested last month on initial allegations of financial misconduct.

The Tokyo prosecutor said the fresh allegations were based on suspicions that around October 2008, Ghosn shifted personal trades to the automaker so that he could avoid paying for 1.85 billion yen ($16.6m) in losses.

The Tokyo court said in a statement that the lawyer for Ghosn’s former deputy Greg Kelly, who was arrested along with Ghosn, has requested for his client to be released. Kelly’s detention extension was rejected along with Ghosn’s. So far, the new allegation only applies to Ghosn.

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The latest twist to the rollercoaster saga came hours after Ghosn, through his lawyer and quoted by Japanese public broadcaster NHK, vowed to restore his good name in court and to hold a news conference after his release.

“Things as they stand are absolutely unacceptable,” he was quoted as saying. “I want to have my position heard and restore my honour in court.”

TV camera crews had gathered outside the Tokyo jail on Friday morning in the hopes of catching sight of Ghosn being released.

Dramatic fall

Ghosn was initially arrested on November 19 for allegedly understating his income by about half over a five-year period from 2010. He was later rearrested for a similar alleged crime covering the past three years.

Nissan said after his arrest that it unearthed multiple instances of possible wrongdoing in an internal investigation triggered by a whistle-blower.

The Ghosn case has put Japan’s criminal justice system under international scrutiny and sparked criticism for some of its practices, including keeping suspects in detention for long periods and prohibiting defence lawyers from being present during interrogations, which can last eight hours a day.

The case also marked a dramatic fall for the leader of the Nissan-Renault-Mitsubishi alliance who was once hailed for rescuing Nissan from the brink of bankruptcy. Nissan Chief Executive Hiroto Saikawa has since called for changes to weaken the clout of controlling shareholder Renault SA.

While Nissan removed Ghosn from his role as chairman shortly after the initial arrest, Renault has so far not replaced him.