Also on the chopping block is Nissan representative director Greg Kelly, who was discovered to be "deeply involved" in reporting compensation amounts in the Tokyo Stock Exchange securities report that were less than the actual amount. While no longer Nissan's chief executive officer, he's been laying the groundwork as chairman to make the alliance permanent after his departure - including the possibility of a merger.
The Tokyo District Public Prosecutors Office declined to comment.
He and Director Greg Kelly have been under investigation at Nissan for several months, and the company is seeking to oust them both, it said. Mr Ghosn had already begun shedding some of his responsibilities - he stepped down as chief executive of Nissan past year, and recently offloaded some day to day responsibilities at Renault as well.
Ghosn stepped down as CEO of Nissan in 2017.
Nissan says it will seek a removal of Carlos Ghosn as its chairman after an investigation into his alleged misconduct. Ghosn receives numerous paychecks in his multiple roles as chairman of the Renault-Nissan-Mitsubishi alliance, CEO of Renault, and chairman of both Nissan and Mitsubishi.
Nissan said it was providing information to the prosecutors and co-operating with their investigation.
After Mitsubishi Motors' sales plummeted in the wake of fuel data manipulation scandal, Nissan took control of the smaller Japanese automaker in 2016 by purchasing a big equity stake. The country owns about 15 percent of Renault and supported Ghosn's renewal at the helm of the French automaker. He was named Nissan's chairman in 2000 and CEO the following year, although he stood down from the latter role last year.
Ghosn has been contemplating his career moves as the companies plan to change the pact's structure, possibly through a merger.
In a statement, Nissan said it had been conducting a probe into Ghosn for several months after receiving a whistleblower report and had uncovered misconduct going back several years. They raided Nissan's headquarters in Yokohama, near Tokyo. In addition to this, he received 9.2 million euros in his final year as Nissan chief executive.