WASHINGTON- US Aerospace giant, Boeing is set to plead guilty to a criminal fraud charge related to two 737 MAX crashes that killed 346 people after the government found that the company violated an agreement that had protected it from prosecution for over three years, the Justice Department announced Sunday (July 7, 2024) night.
Last week, federal prosecutors gave Boeing the option of pleading guilty and paying a fine as part of its sentence or facing a trial on the felony criminal charge of conspiracy to defraud the United States.
Boeing Guilty over 737 MAX Crashes
Prosecutors accused the American aerospace giant of deceiving regulators who approved the airplane and its pilot-training requirements.
The plea deal, which requires approval from a federal judge to take effect, includes Boeing paying an additional $243.6 million fine—the same amount it paid under the 2021 settlement that the Justice Department said the company breached.
An independent monitor will oversee Boeing’s safety and quality procedures for three years. The deal also mandates that Boeing invest at least $455 million in its compliance and safety programs.
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The plea deal addresses only Boeing’s wrongdoing before the crashes, which resulted in the deaths of all 346 passengers and crew members on two new MAX jets. It does not provide Boeing with immunity for other incidents, such as a panel that blew off a MAX jetliner during an Alaska Airlines (AS) flight in January, a Justice Department official said.
The deal applies only to the corporation and does not cover any current or former Boeing officials. In a statement, Boeing confirmed reaching the deal with the Justice Department but had no further comment.
Families Want Criminal Prosecution of Boeing
In a court filing on Sunday night, the Justice Department stated it expected to file the written plea agreement with the court by July 19. Lawyers representing some relatives of those who died in the crashes have said they will ask the judge to reject the agreement.
“This sweetheart deal fails to recognize that 346 people died due to Boeing’s conspiracy. Through crafty lawyering between Boeing and the DOJ, the deadly consequences of Boeing’s crime are being hidden,” said Paul Cassell, a lawyer representing some of the families.
Federal prosecutors alleged that Boeing conspired to defraud the government by misleading regulators about a flight-control system implicated in the crashes, which occurred in Indonesia in October 2018 and Ethiopia less than five months later.
As part of the January 2021 settlement, the Justice Department agreed not to prosecute Boeing on the charge if the company complied with certain conditions for three years. However, prosecutors alleged last month that Boeing had breached the terms of that agreement.
Boeing’s guilty plea will be entered in U.S. District Court in Texas. The judge overseeing the case, who has criticized what he called “Boeing’s egregious criminal conduct,” could accept the plea and the sentence offered by prosecutors, or he could reject the agreement, likely leading to new negotiations between the Justice Department and Boeing.
CEO Senate Hearing
At a recent Senate hearing, Boeing CEO David Calhoun defended the company’s safety record after turning and apologizing to the relatives of Max crash victims seated behind him “for the grief that we have caused.”
Hours before the hearing, the Senate investigations subcommittee released a 204-page report featuring new allegations from a whistleblower who expressed concerns about defective parts potentially being used in 737s.
This whistleblower is the latest in a series of current and former Boeing employees who have raised safety concerns about the company and claimed they faced retaliation as a result.
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