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Boeing pleads guilty in investigation of two fatal plane crashes

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Important points
  • Boeing has agreed to plead guilty to charges of criminal fraud conspiracy
  • The US Department of Justice investigation was related to two fatal crashes of the 737 MAX in which 346 people died.
  • Some of the victims’ families criticized the confession as a “favor deal.”
Boeing has agreed to plead guilty to charges of criminal conspiracy to commit fraud in order to resolve a U.S. Department of Justice investigation related to a US government official said on Sunday.
The motion, which still needs to be approved by a federal judge, would brand the plane maker a felon and require Boeing to pay a fine of $US243.6 million ($360 million), a US Justice Department official said.
The charges relate to two crashes of a 737 MAX in Indonesia and Ethiopia over five months in 2018 and 2019 that killed 346 people and led victims’ families to demand criminal prosecution of Boeing.

An admission of guilt potentially jeopardizes the company’s ability to land lucrative government contracts such as those from the U.S. Department of Defense and NASA, although the company could seek exemptions.

Boeing faced criminal prosecution after the Justice Department found in May that the company had violated a 2021 settlement related to the crashes.
The plea bargain spares Boeing a contentious trial that would have exposed many of the company’s decisions that led to the fatal MAX plane crashes to even greater public scrutiny.
In addition, the company, which will get a new CEO later this year, would find it easier to push forward approval for its planned acquisition of Spirit Aerosystems, a manufacturer of parts for commercial aircraft.
A Boeing spokesman confirmed that they had “reached an agreement in principle with the Department of Justice on the terms of a resolution.”
Boeing has committed to investing at least $455 million (US$673 million) over the next three years to strengthen its safety and compliance programs.

The Justice Department will appoint an independent auditor to monitor the company’s compliance and will be required to submit annual public reports to the court on the company’s progress.

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In addition, Boeing must complete a probationary period until the end of the overseer’s three-year term, during which the company agrees not to violate any laws.
After lawyers for some families were informed of the Justice Department’s offer, they criticized it and announced that they would fight it in court.
“The families intend to argue that the deal with Boeing makes unfair concessions that other defendants would never make in a criminal case and that Boeing will not be held responsible for the deaths of 346 people,” they said in a separate court document.
On January 5 of this year, a commission shot down a new 737 MAX jet on an Alaska Airlines flight, and Boeing is currently under a separate criminal investigation into the incident.

The agreement with the Justice Department relates only to Boeing’s conduct prior to the fatal crashes and does not protect the aircraft maker from any further investigations or charges related to the January incident or its other conduct.

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