
Boeing, Justice Department reach deal to avoid prosecution over deadly 737 Max crashes
The U.S. Justice Department said Friday that it has reached a deal with Boeing to avoid prosecution over two crashes of the plane maker's 737 Max that killed 346 people.
The so-called non-prosecution agreement would allow Boeing, a major military contractor and top U.S. exporter, to avoid being labeled a felon. The decision means Boeing won't face trial as scheduled next month.
The Justice Department said it reached a deal with Boeing in a letter to victims family members, which was seen bc CNBC. Boeing and the DOJ didn't immediately comment.
Boeing has been trying for years to put the two crashes of its best-selling Max planes — a Lion Air flight in October 2018 and an Ethiopian Airlines flight less than five months later — behind it. The Maxes were grounded worldwide for nearly two years after the second crash, a pause that gave rival Airbus a head start to recover from the Covid pandemic.
But families of the crash victims have criticized previous agreements as sweetheart deals for Boeing, called for more accountability from the company and said its executives should stand trial. In 2022, a former chief technical pilot for Boeing was acquitted on fraud charges tied to the Max's development.
The aerospace giant reached a settlement in 2021 in the final days of the first Trump administration that shielded it from prosecution for three years.
Under that deal, Boeing agreed to pay a $2.51 billion fine to avoid prosecution. That included a $243.6 million criminal penalty, a $500 million fund for crash victims family members and $1.77 billion for its airline customers.
That 2021 settlement was set to expire two days after a door panel blew out of a nearly new 737 Max 9 operated by Alaska Airlines on Jan. 5, 2024, after the aircraft left Boeing's factory without key bolts installed.
But last year, U.S. prosecutors said Boeing violated the 2021 settlement, accusing the company of failing to set up and enforce a compliance and ethics program to detect violations of U.S. fraud laws.
Last July, toward the end of the Biden administration, Boeing agreed to plead guilty to the criminal fraud charge in a new settlement. A federal judge later rejected the plea deal, citing concerns with a diversity, equity and inclusion requirements for choosing a corporate monitor.
Under that 2024 deal, Boeing would have faced a fine of up to $487.2 million, though the Justice Department recommended that the court credit Boeing with half that amount it paid under the previous agreement.
The U.S. had accused Boeing of conspiracy to defraud the government by misleading regulators about its inclusion of a flight-control system on the Max that was later implicated in the two crashes.
"Boeing's employees chose the path of profit over candor by concealing material information from the FAA concerning the operation of its 737 Max airplane and engaging in an effort to cover up their deception," then-acting Assistant Attorney General David Burns of the Justice Department's Criminal Division said at the time of the 2021 deferred prosecution agreement.
Messages revealed in an investigation into the Max's development showed the former top Boeing pilot who was found not guilty of fraud in 2022, Mark Forkner, told the FAA to delete the flight-control system known as MCAS from manuals and, in a separate email, he boasted about "jedi-mind tricking" regulators into approving the training material.
Lawyers for victims' family members railed against last year's preliminary plea deal, equating it to a slap on the wrist for the corporate giant, which recently won a contract worth billions to built the next-generation fighter jet.
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
24 minutes ago
- Yahoo
Marines arrive in LA under Trump orders as protests spread to other cities
By Brad Brooks, Jorge Garcia, Phil Stewart and Idrees Ali LOS ANGELES (Reuters) -Hundreds of U.S. Marines arrived in Los Angeles overnight and more were expected on Tuesday under orders from President Donald Trump, who has also activated 4,000 National Guard troops to quell protests despite objections from California Governor Gavin Newsom and other local leaders. The city has seen days of public outrage since the Trump administration launched a series of immigration raids on Friday, though local officials said the demonstrations on Monday were largely peaceful. About half of the roughly 700 Marines that Trump ordered to Los Angeles arrived on Monday night, and the remaining troops will enter the city on Tuesday, a U.S. official told Reuters. The U.S. military did not immediately respond to a request for comment. Los Angeles Mayor Karen Bass told KABC that more than 100 people had been arrested on Monday but that the majority of protesters were nonviolent. Over the weekend, protesters threw rocks and other objects at officers and vehicles and set several cars ablaze. Police responded by firing projectiles like pepper balls as well as flash bang grenades and tear gas. Trump has justified his decision to deploy active military troops to Los Angeles by describing the protests as a violent occupation of the city, a characterization that Newsom and Bass have said is grossly exaggerated. Newsom said that Trump's deployment of National Guard troops has only inflamed the situation and made it more difficult for local law enforcement to respond to the demonstrations. In a statement on Monday, Los Angeles Police Chief Jim McDonnell said the department had not been notified that any Marines were traveling to the city and that their possible arrival "presents a significant logistical and operational challenge" for police. Trump's decision to mobilize 700 Marines based in Southern California escalated his confrontation with Newsom, who filed a lawsuit on Monday asserting that Trump's deployment of Guard troops without the governor's consent was illegal. The Guard deployment was the first time in decades that a president activated the Guard absent a request from a sitting governor. While the Marines are only tasked with guarding federal property temporarily until the full contingent of 4,000 Guard troops arrives, the use of active military to respond to civil disturbances is extremely rare. "This isn't about public safety," Newsom wrote on X on Monday. "It's about stroking a dangerous President's ego." The top Democrat on the Senate Armed Services Committee, Senator Jack Reed, said he was "gravely troubled" by Trump's deployment of active-duty Marines. "Since our nation's founding, the American people have been perfectly clear: we do not want the military conducting law enforcement on U.S. soil," he said. In a post on Tuesday morning on Truth Social, Trump claimed Los Angeles would be "burning to the ground right now" if he had not deployed troops to the city. DEMONSTRATIONS AND ARRESTS The raids are part of Trump's sweeping immigration crackdown, which Democrats and immigrant advocates have said are indiscriminately breaking up families. U.S. Homeland Security Secretary Kristi Noem pledged on Monday to carry out more operations to round up suspected immigration violators. Trump officials have branded the protests as lawless and blamed state and local Democrats for protecting undocumented immigrants with sanctuary cities. Hundreds of demonstrators gathered on Monday outside a federal detention center in downtown Los Angeles where immigrants have been held, chanting "free them all" and waving Mexican and Central American flags. National Guard forces formed a human barricade to keep people out of the building, and late on Monday, police began dispersing the crowd using gas canisters and arrested some protesters. At dusk, officers had running confrontations with protesters who had scattered into the Little Tokyo section of the city. As people watched from apartment patios above street level and as tourists huddled inside hotels, a large contingent of LAPD and officers and sheriff's deputies fired several flash bangs that boomed through side streets along with tear gas. Protests spread to neighboring Orange County on Monday night after immigration raids there, with demonstrators gathering at the Santa Ana Federal building, according to local officials and news reports. Protests also sprang up in at least nine other U.S. cities on Monday, including New York, Philadelphia and San Francisco, according to local news reports. In Austin, Texas, police fired non-lethal munitions and detained several people as they clashed with a crowd of several hundred protesters.
Yahoo
26 minutes ago
- Yahoo
BlackRock, Goldman Scale Up Tax Trades in $3 Trillion SMA Boom
(Bloomberg) -- This year's stock market turbulence has punished ordinary investors. But for the wealthy, it's opened up fresh opportunities to convert equity swings into tax breaks — fueling a growing Wall Street business that turns volatility into a financial advantage. Trump Said He Fired the National Portrait Gallery Director. She's Still There. NYC Mayoral Candidates All Agree on Building More Housing. But Where? Senator Calls for Closing Troubled ICE Detention Facility in New Mexico California Pitches Emergency Loans for LA, Local Transit Systems BlackRock Inc., Goldman Sachs Group Inc. and Morgan Stanley are among firms scaling up a strategy known as tax-loss harvesting, typically offered through customized portfolios called separately managed accounts. When markets drop, managers sell stocks trading below their purchase price to realize losses. Those losses offset gains elsewhere in a portfolio, reducing clients' tax liabilities while maintaining overall portfolio exposure. The approach allows investors to shrink their current-year IRS bills while deferring capital gains into the future. In April's selloff, for example, a manager could dump Home Depot Inc. and rotate into Lowe's Cos Inc., maintaining sector exposure while staying inside tax rules. Once a boutique service reserved only for the ultra-rich, investment firms are repackaging market turbulence as a fiscal opportunity, with automated trading programs scanning portfolios daily as equity conditions shift. With fee pressure eroding revenue in traditional asset management, Wall Street is leaning more heavily on tax-optimization trades to differentiate offerings, retain clients and defend margins in a competitive marketplace. 'There is just inherently going to be more volatility in the system,' said Scott Smith, senior director at industry consultant Cerulli Associates. 'With trade policies, tariffs, taxes, everything is on the table. There is no assumption of what the future looks.' In one particularly active stretch during April's selloff, BlackRock's Aperio, a platform for personalized portfolios, executed more than $18 billion in trades. That generated $700 million in realized losses that can be used to offset taxable gains elsewhere in client portfolios, or so-called tax-loss harvesting. That equated to roughly $5 to $7 in losses realized for every $100 traded that month. 'We monitor daily. We look at losses and high-cash positions. We balance harvesting with managing tracking error,' said Ran Leshem, who oversees BlackRock's separately managed account business, now managing $220 billion. 'Our goal is to be the market leader in SMAs.' Still, even as this year's selling frenzy created opportunities, the equity rebound that followed highlights a trade-off: while the approach can lower future tax bills, it also locks in losses that may prove costly if markets quickly recover, making the ultimate payoff difficult to measure in real time. Regardless, the opportunities are only growing. Direct indexing, where investors hold individual stocks directly rather than through pooled funds, has become the backbone of this tax-optimization machine. With the SMA market expected to grow from $3 trillion to $5 trillion by 2027, firms are layering on increasingly complex techniques to compete, pitched as added-value services. Tax-loss harvesting is only one lever. Advisors also optimize dividend timing, gain deferrals, charitable gifting and jurisdictional overlays in an attempt to juice after-tax portfolio performance. 'Risk management and tax management go hand in hand,' said Monali Vora, global head of wealth investment solutions at Goldman Sachs Asset Management. 'You can't do one without the other.' Aperio's long-short tax-aware strategies, launched in 2023, amplify gross exposure — boosting the number of positions that can generate harvestable losses, while keeping market exposure roughly the same. About 7% of April's realized losses came from these strategies. While still a small share of overall assets, it's part of the firm's expanding business. Managing tracking error, or how closely a portfolio tracks its benchmark, remains a challenge. The IRS wash-sale rule bars investors from buying back the same, or substantially identical, securities over a specified timeframe. Firms navigate these constraints by swapping into correlated securities. Selling Moderna Inc. and buying Pfizer Inc. is straightforward; replacing a giant like Apple Inc. requires more complex substitutes. 'Clients are seeking alpha, downside protection and more tax-loss harvesting potential for both ETF and stock positions,' Leshem said. 'But with that comes the tug of war between harvesting and maintaining tracking error.' At Dimensional Fund Advisors LP, the approach is different. Instead of mirroring an index, the Texas-based firm uses broad diversification across thousands of stocks to reduce wash-sale risk, reallocating proceeds toward securities with higher expected returns based on their quant model. 'We can keep the profile of the account but take advantage of tax opportunity,' said Savina Rizova, co-chief investment officer and global head of research. Dimensional, which lowered its account minimum to $500,000 in 2021, harvested $20 million in net losses across about 1,400 accounts in April — averaging $16,700 in losses per $1 million invested. Parametric, Morgan Stanley's direct indexing arm, strikes a more cautious tone. 'Tax-loss harvesting is one layer of customization, but there are many others,' said co-president and CIO Tom Lee. 'For most institutions, tax management isn't their focus.' At the height of April's volatility, Parametric harvested $620 million in losses, generating around $230 million in potential tax benefits. That same month, Parametric also introduced an offering with a $25,000 minimum investment, part of a broader push to open direct-indexing features to smaller accounts and widen the client base for tax-managed SMAs. Quant hedge funds such as AQR Capital Management are also in tax-optimization arena, applying long-short structures aimed at maximizing harvestable losses while managing exposure drift. As competition heats up, Goldman Sachs Asset Management is pushing into new customization features to expand its tax-optimized platform, such as introducing capabilities to migrate equity ETFs into SMA portfolios. The firm has also ramped up its engineering staff to scale automation and global execution as tax-optimized services become increasingly industrialized. While tax-loss harvesting can reduce tax bills, research shows the biggest benefits tend to accrue to wealthier investors with large taxable portfolios and steady capital gains to offset. As such, for investors able to access these platforms, the appeal is simple. 'There is an awareness among investors that it's not what you make, it's what you keep,' said Parametric's Lee. 'Taxes represent a headwind for investors to the extent they have to realize gains in taxable accounts. You can take advantage of volatility when it comes.' --With assistance from Justina Lee and Lu Wang. New Grads Join Worst Entry-Level Job Market in Years The SEC Pinned Its Hack on a Few Hapless Day Traders. The Full Story Is Far More Troubling What America's Pizza Economy Is Telling Us About the Real One Cavs Owner Dan Gilbert Wants to Donate His Billions—and Walk Again American Mid: Hampton Inn's Good-Enough Formula for World Domination ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data

USA Today
27 minutes ago
- USA Today
Multiple journalists injured by police nonlethal rounds while covering LA protests
Multiple journalists injured by police nonlethal rounds while covering LA protests Show Caption Hide Caption Australian journalist shot with a rubber bullet in Los Angeles Australian journalist from 9News, Lauren Tomasi, was shot with a rubber bullet while reporting from the protests in Los Angeles. Multiple members of the media have been injured by nonlethal rounds fired by law enforcement while covering dayslong protests over the Trump administration's immigration crackdown in Los Angeles, prompting the Committee to Protect Journalists to sound an alarm about the intimidation of reporters. Authorities braced for a fifth day of demonstrations on June 10, with President Donald Trump ordering the National Guard and members of the U.S. Marine Corps in a show of force against unrest. The administration's stepping in has also ignited a clash between local leaders, including California Gov. Gavin Newsom, and the federal government. As officers use force against protesters, some journalists reporting on the melee have been caught by nonlethal rubber rounds and other projectiles. Adam Rose, the secretary of the Los Angeles Press Club, has documented more than 30 incidents of reporters, photographers and other media professionals impacted by police actions that range from searching a journalist's bag to firing tear gas or rubber bullets at them. In one viral video, an officer appears to aim and take fire at Australian reporter Lauren Tomasi, who yelped in pain when she was hit in the leg. More: Australian journalist shot with nonlethal bullet while reporting on LA protests The committee, which advocates for press freedom and documents cases of journalists who are killed, imprisoned or missing, said it was "greatly concerned" by the reports of officers' shooting nonlethal rounds at reporters on the ground. "Any attempt to discourage or silence media coverage by intimidating or injuring journalists should not be tolerated,' Katherine Jacobsen, program coordinator for the Committee to Protect Journalists in the U.S., Canada and the Caribbean, said in a statement. 'It is incumbent upon authorities to respect the media's role of documenting issues of public interest.' The Los Angeles Police Department and the California Highway Patrol didn't immediately respond to a USA TODAY inquiry on the injured journalists. The department told the Committee to Protect Journalists it will investigate the incidents. LA protest updates: Newsom calls Trump's Marine deployment a 'blatant abuse of power' Journalists injured by rubber bullets, other nonlethal rounds Tomasi, the Australian reporter, was sore after being hit by the rubber bullet but otherwise unharmed, her employer Australia's 9News said. British freelance photographer Nick Stern had to undergo emergency surgery after also being hit in the leg with a nonlethal round, he told the BBC. Stern said he was covering the protests in Los Angeles on June 8 when he was hit by a 3-inch "plastic bullet," BBC reported. He said he was wearing his press credentials and wearing a big camera around his neck. "There was something hard sticking out of the back of my leg and my leg was getting wet from blood," he told the outlet. Stern told BBC protesters helped carry him away from the "danger area" and a medic applied a tourniquet. "I intend, as soon as I am well enough, to get back out there," he told BBC. "This is too important and it needs documenting." A New York Post photographer was also hit with a rubber bullet in the head, the outlet reported. Toby Canham was standing just off the 101 freeway in Los Angeles the evening of June 8 "when a California Highway Patrol (CHP) officer suddenly turned his weapon toward him and fired from about 100 yards away," the Post reported. He went to the hospital for whiplash and neck pain and had a bruise on his forehead. 'It's a real shame. I completely understand being in the position where you could get injured, but at the same time, there was no justification for even aiming the rifle at me and pulling the trigger, so I'm a bit pissed off about that, to be honest,' Canham said. Officers also shot Ryanne Mena, a reporter with the Southern California News Group, with pepper ball bullets, which contain a chemical akin to pepper spray, she said in a post on social media. Police briefly detained CNN correspondent Jason Carroll while he was on the air covering protests on June 9. In-studio anchors briefly lost contact with Carroll, who could be seen being led away by LAPD officers with hands behind his back. An officer can be heard telling Carroll: "We're letting you go. You can't come back. If you come back, you will be arrested." "You take a lot of risks as press. This is low on that scale of risks, but it is something that I wasn't expecting, simply because we've been out here all day," Carroll said. "I've covered any number of protests, and normally the officers realize that the press is there doing a job." What's happening in LA protests Protests began on June 6 in response to the Trump administration's crackdown with immigration raids in Southern California. Immigration and Customs Enforcement is carrying out a directive from Trump to find immigrants living in the United States without legal status. Protests have sprung up against the sweeps the agency is carrying out in various neighborhoods. The protests began largely peacefully after U.S. Immigration and Customs Enforcement sweeps near Los Angeles resulted in more than 40 arrests, but flared up when heavily armed, masked agents raided Los Angeles businesses. For several days, the demonstrations have grown and turned chaotic and sometimes violent, with police and protesters clashing in the streets. A tense standoff unfolded between the administration and California authorities, who say the use of the National Guard and U.S. Marines is an unlawful subversion of Newsom's authority. Los Angeles Mayor Karen Bass called Trump's escalation of military presence a "deliberate attempt to create disorder and chaos in our city." On Monday, LAPD said protesters threw objects at officers near the federal courthouse, prompting use of gas canisters and other munitions. Bass said over 100 people were arrested Monday night, blaming "fringe groups" for violence. Contributing: Thao Nguyen, John Bacon, Greta Cross and Taijuan Moorman, USA TODAY