Boeing has pleaded guilty to a criminal fraud charge related to the crashes of two 737 Max jetliners, which resulted in the deaths of 346 people. The Justice Department announced on Sunday night that Boeing violated a previous agreement that shielded the company from prosecution for over three years. Federal prosecutors offered Boeing the option last week to plead guilty and pay a fine as part of its punishment, or face trial for the felony criminal charge of conspiracy to defraud the United States. Prosecutors alleged that Boeing misled regulators involved in approving the aircraft and its associated pilot-training criteria.
Boeing to pay $243.6 million as fine
Boeing must spend at least $455 million on compliance and safety initiatives and pay an additional $243.6 million in fines as part of the plea agreement. For three years, an impartial observer will supervise Boeing’s safety and quality protocols. Only misconduct committed before the crashes is covered by the agreement; no other incidents or current or former Boeing officials are protected.
The agreement is opposed by crash victims’ relatives who claim Boeing is not held responsible. According to federal prosecutors, Boeing lied to regulators regarding a flight-control system that was used in the 2018 and 2019 crashes in Ethiopia and Indonesia. Prosecutors said last month that Boeing had broken an agreement made when the Justice Department first promised not to prosecute the company if certain requirements were met.
All about Boeing plea deal
As part of the plea deal, Boeing has to pay an additional $243.6 million in penalty and invest at least $455 million in compliance and safety initiatives. A third-party observer will oversee Boeing’s safety and quality procedures for three years. The agreement only protects against misconduct that occurred before the crashes; it does not cover any other incidents on current or former Boeing officials.
With its contracts with NASA and the defense department, Boeing’s standing as a government contractor may be impacted by a criminal conviction. To prosecute high-ranking officials and uncover what Boeing knew about misleading the Federal Aviation Administration (FAA), victims’ relatives are requesting a criminal trial. Meanwhile, David Calhoun, the CEO of Boeing, has expressed regret to the families of the victims and defended the company’s safety record.
(With inputs from AP)