The Ministry of Justice has submitted an agreement with Boeing On Wednesday, the aerospace giant will plead guilty to a fraud charge for misleading U.S. regulators who approved the 737 Max airliner before two of the planes crashed, killing 346 people.
The detailed plea agreement was filed in federal court for the District of Texas. The U.S. company and the Justice Department reached an agreement on the guilty plea and the general terms of the agreement reached earlier this month.
The finalized version states Boeing Boeing admitted that it entered into a “dishonest means” agreement with its employees to defraud the FAA panel that evaluated the 737 Max. Because of Boeing’s deception, the FAA had “incomplete and inaccurate information” about the plane’s flight control software and the level of training pilots would need to use it, according to the plea agreement.
U.S. District Judge Reed O’Connor can accept the deal and sentence worked out between Boeing and prosecutors, or he can reject it, which would likely lead to further negotiations between the company and the Justice Department.
The agreement provides for the appointment of an independent compliance monitor, three years of probation and a $243.6 million fine. It also requires Boeing to invest at least $455 million “in its compliance, quality and safety programs.”
Boeing released a statement saying the company “will continue to work transparently with our regulators as we take important steps within Boeing to further strengthen” these programs.
Paul Cassell, a lawyer for the families of 737 Max crash victims who wanted Boeing to go to trial, criticized the deal.
“This motion has all the problems that the families feared. We will file a strong objection to the preferential and favorable treatment that Boeing is receiving,” he said.
Boeing has been accused of misleading the FAA about aspects of the Max before the agency certified the plane for flight. Boeing failed to inform airlines and pilots about the new software system, called MCAS, which could rotate the plane’s nose down without pilot intervention if a sensor detected the plane was at risk of aerodynamic stall.
Max planes crashed in 2018 in Indonesia and in 2019 in Ethiopia after a faulty sensor reading pushed the nose down and the pilots couldn’t regain control. After the second crash, Max planes were grounded worldwide until the company redesigned MCAS to make it less powerful and use signals from two sensors, not just one.
Boeing avoided lawsuits in 2021 by reaching settlement $2.5 billion settlement with the Justice Department, which included an earlier $243.6 million fine. It seemed like the fraud charge would be dropped for good until January, when a panel covering an unused exit blew up a 737 Max on an Alaska Airlines flight. led to a new review of corporate security.
In May of this year, prosecutors said Boeing had violated terms of the 2021 agreement by failing to implement promised changes to detect and prevent violations of federal anti-fraud laws. Boeing agreed this month to plead guilty to the fraud charge instead of undergoing a potentially lengthy public trial.
The role and monitor authority The clause is considered a key provision in the new plea deal, according to experts in corporate governance and white-collar crime. Cassell said the families of the crash victims should have the right to propose a monitor for the judge to appoint. The deal calls for the government to select the monitor “taking into account input from Boeing.”
In the filing Wednesday, the Justice Department said Boeing “has taken significant steps” to improve its anti-fraud compliance program since 2021, but the changes “have not been fully implemented or tested to demonstrate that they would prevent and detect similar misconduct in the future.”
That’s where the independent monitor will step in, “to reduce the risk of misconduct,” the plea agreement states.
Boeing, headquartered in Arlington, Virginia, is a major contractor to the Pentagon and NASA, and a guilty plea is unlikely to change that. Government agencies have the ability to hire companies even after a criminal conviction. The plea agreement does not address the issue.
Some close to passengers plan to ask the judge to dismiss They want a full trial, a harsher sentence for Boeing, and many want current and former Boeing executives indicted.
If the judge approves the deal, it would apply to criminal charges stemming from the 737 Max crashes. It would not resolve other issues, including potentially litigation related to the crash. Alaska Airlines Downfall.
O’Connor will give the families’ lawyers seven days to file legal requests Boeing and the Justice Department will have 14 days to respond, and the families will have five days to respond to documents filed by the company and the government.
