Boeing Co. agreed to plead guilty to a criminal fraud conspiracy charge related to fatal 737 Max crashes in 2018 and 2019 that killed 346 people.
According to a court filing late Sunday night, the aircraft manufacturer will pay $243.6 million in fines and invest at least $455 million in its compliance safety programs over three years.
The guilty plea is the latest blow to the company, which is under increased scrutiny from Congress and the Federal Aviation Administration after a mid-flight door plug blow-out on a 737 Max 9 plane in January.
According to charges filed in 2021 after the crashes, Boeing committed conspiracy to defraud the government by misleading the FAA about a flight-control system used in those aircraft. Boeing averted prosecution in 2021 by agreeing to a three-year probationary period.
But the January door plug incident occurred just days before the company’s probationary period ended. The DOJ said in May it was looking to bring charges for violating the 2021 agreement. This deal settles that matter.
The agreement stipulates that Boeing will be put on a new three-year probation under supervision of a compliance monitor and requires the board of directors to meet with the families of crash victims. The plea deal is still subject to a judge’s approval.
Boeing confirmed the agreement in a statement but did not provide additional details.
The guilty plea is not enough for some family members of crash victims, according to a court filing. In it, the DOJ said it afforded the families “numerous opportunities” to express their views, detailing hours-long meetings discussing the probe. But the filing states that there was “some opposition” regarding the government entering into a plea deal, which the DOJ said it worked to address.
The fines set out in the deal fall far below the nearly $25 billion that the families called for.
Aside from legal challenges, a Senate report released last month piled even more allegations of the airline manufacturer mishandling damaged parts and attempting to eliminate quality inspections. An FAA audit, as well as a report from a panel commissioned by the agency, found safety culture and manufacturing quality concerns at the company.
Boeing CEO Dave Calhoun told senators in a June hearing that the company has developed an action plan, which the FAA required the company to complete, that aims to address safety culture concerns.
“Much has been said about Boeing’s culture. We’ve heard those concerns loud and clear … but we are taking action and making progress,” he said. “We understand the gravity, and we are committed to moving forward with transparency and accountability, while elevating employee engagement.”
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