It was awaited, and could be one of the low points in company's glorious history, latest development is, Boeing has agreed to plead guilty to a criminal fraud charge tied to the 737 Max crashes, months after a near-catastrophe in January prompted the Justice Department to revisit a 2021 settlement that protected Boeing from prosecution.
Under the agreement in principle with US prosecutors, Boeing faces the criminal fine of as much as $487.2 million, the maximum allowed by law, though the actual amount will be determined by a judge, according to the Justice Department.
“We can confirm that 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.
The charge relates to two 737 MAX crashes in Indonesia and Ethiopia over a five-month period in 2018 and 2019 that killed 346 people and prompted the families of the victims to demand that Boeing face prosecution.
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The U.S. Justice Department charged Boeing in 2021 with deceiving FAA regulators about the software, which did not exist in older 737s, and about how much training pilots would need to fly the plane safely.
The Justice department agreed not to prosecute Boeing at the time, however, if the company paid a $2.5 billion settlement, including the $243.6 million fine, and took steps to comply with anti-fraud laws for three years.
On these ground, Boeing became exposed to criminal prosecution after the Justice Department in May found the company violated the 2021 settlement involving the fatal crashes.
Noteworthy here is, a guilty plea could threatens the Boeing's ability to secure future government contracts with the likes of the US Defense Department and NASA, although it could seek waivers.
The company will now install a corporate monitor and be required to spend at least $455 million to bolster its compliance and safety programs over the next three years as part of the deal, which requires court approval. It would also be subject to three years of court-supervised probation.
With this, the plea spares Boeing a contentious trial that could have exposed many of the company's decisions leading up to the fatal MAX plane crashes to even greater public scrutiny.
It would also make it easier for the company, which will have a new CEO later this year, to try to move forward as it seeks approval for its planned acquisition of Spirit AeroSystems.
Lawyers for some of the relatives of those who died in the two crashes have said they will ask the judge to reject the agreement.
“This sweetheart deal fails to recognize that because of Boeing’s conspiracy, 346 people died. Through crafty lawyering between Boeing and DOJ, the deadly consequences of Boeing’s crime are being hidden,” said Paul Cassell, a lawyer for some of the families.
Relatives of those who died in the crashes continued pushing the Justice Department to prosecute Boeing and former and current executives, but they admitted the public seemed to be losing interest in questions about the Max’s safety record.
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