Boeing Co yesterday said it had reached a deal with the US Department of Justice (DOJ) over two fatal 737 MAX crashes, which court papers showed would see the aviation giant plead guilty to fraud.
The agreement comes after prosecutors concluded that Boeing flouted an earlier settlement addressing the disasters, in which 346 people were killed in Ethiopia and Indonesia more than five years ago.
“We have reached an agreement in principle on terms of a resolution with the justice department, subject to the memorialization and approval of specific terms,” Boeing said in a statement.
Photo: Reuters
Court papers filed on Sunday in Texas said the company had agreed to plead guilty to “conspiracy to defraud the United States” during the certification of MAX airplanes.
Boeing would be fined under the deal and must invest a minimum of US$455 million in “compliance and safety programs,” while compensation for families would be determined by the court.
Boeing’s latest legal predicament was triggered by a justice department determination in mid-May that the company ignored a 2021 deferred prosecution agreement (DPA) by not meeting requirements to improve its compliance and ethics program after the MAX crashes.
Families of MAX victims were “highly disappointed” by the deal reached between Boeing and the justice department, an attorney at Clifford Law Offices representing them said.
“Much more evidence has been presented over the last five years that demonstrates that the culture of Boeing putting profits over safety hasn’t changed. This plea agreement only furthers that skewed corporate objective,” Clifford senior partner Robert A. Clifford said in a statement.
The families would ask the court to reject the plea deal at an upcoming hearing, an opposition filed by their legal team showed.
The original DPA was announced in January 2021, over charges that Boeing knowingly defrauded the US Federal Aviation Administration during the certification of the MAX. The agreement required Boeing to pay US$2.5 billion in fines and restitution in exchange for immunity from criminal prosecution.
A three-year probationary period was set to expire this year, but in January, Boeing was plunged back into crisis mode when a 737 MAX flown by Alaska Airlines was forced to make an emergency landing after a fuselage panel blew out mid-flight.
In a May 14 letter to the US court, DOJ officials said that Boeing breached its obligations under the DPA by “failing to design, implement, and enforce a compliance and ethics program to prevent and detect violations of the US fraud laws throughout its operations.”
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