Boeing has finalized its plea agreement with the United States Department of Justice, agreeing to plead guilty to one count of “conspiracy to defraud the United States.”
The charges relate to Boeing misleading the Federal Aviation Administration about the safety of its 737 MAX aircraft, and subsequently violating a 2021 deferred prosecution agreement.
The company agreed in principle to the deal in early July, avoiding a potentially damaging criminal trial and instead accepting a financial penalty, an investment in its safety and compliance initiatives.
Key Details of the Agreement
The charge centers on Boeing’s deception regarding the 737 MAX’s Maneuvering Characteristics Augmentation System (MCAS), which was implicated in two fatal crashes – Lion Air Flight 610 in (2018) and Ethiopian Airlines Flight 302 (2019).
In January 2021, Boeing entered into a deferred prosecution agreement with the DOJ, requiring the company to enhance its compliance and ethics programs and pay significant financial penalties.
In May, however, prosecutors found that Boeing had “failed to “design, implement, and enforce a compliance and ethics program to prevent and detect violations of the U.S. fraud laws throughout its operations,” thereby sacrificing its amnesty.
Financial Penalties
Under the plea, Boeing has agreed to pay:
- A criminal monetary penalty of $487.2 million, half of which was already paid by the company pursuant to the DPA.
- To commit an investment in its compliance and safety programs of “at least” $455.0 million.
- To pay “lawful restitution” to the families of those killed in the 2018 and 2019 crashes, the amount of which shall be determined by the court.
Compliance and Certification
Boeing has committed to “implement a compliance and ethics program reasonably designed, implemented, and enforced to prevent and detect violations of U.S. fraud laws.”
Boeing will also undergo three years of probation, during which an “independent compliance monitor” will oversee its operations.
Boeing will have the chance to strike one of the six monitor candidates selected by the DOJ.
The company has also agreed to “facilitate and conduct” a meeting between the Boeing board of directors and the crash victims’ families within four months of its sentencing.
Waiver of Rights
Boeing has waived certain rights, including the right to dispute the statement of facts or appeal the conviction and sentence, except under specific conditions.
Potential Breach Consequences
Should Boeing breach the DPA, the United States retains the right to prosecute the company for any related federal criminal violations.
Background and Implications
This plea agreement follows a series of investigations into Boeing’s practices concerning the 737 MAX, a model grounded worldwide after the two crashes that claimed 346 lives. The agreement aims to ensure Boeing’s future compliance with U.S. fraud laws and hold the company accountable for past misconduct.
The move is seen as part of broader efforts by regulatory bodies to enhance aviation safety and corporate accountability. By accepting the terms of the plea agreement, Boeing acknowledges its role in the failures that led to the tragic accidents and commits to taking steps to prevent future violations.
Looking Forward
Boeing’s guilty plea and the associated penalties reflect a significant moment in the ongoing effort to restore confidence in the aviation giant.
Now that it has been filed, Judge Reed O’Connor will be able to accept, reject, or defer the plea agreement, and families of those killed in the two MAX crashes will now have one week to file their objections.
One family member previously told Newsweek that this “sweetheart” deal would do nothing to address the company’s safety issues, and that the company has yet to be brought to justice.
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