Boeing reaches deal to avoid prosecution over 737 Max plane crashes
WASHINGTON - The US Justice Department said on May 23 it has struck a deal in principle with Boeing to allow it to avoid prosecution in a fraud case stemming from two fatal 737 Max plane crashes that killed 346 people.
The agreement allows Boeing to avoid being branded a convicted felon and is a blow to families who lost relatives in the crashes and had pressed prosecutors to take the US planemaker to trial. A lawyer for family members and two US senators had urged the Justice Department not to abandon its prosecution, but the government quickly rejected the requests.
Boeing agreed to pay an additional US$444.5 million (S$573.7 million) into a crash victims' fund that would be divided evenly per crash victim on top of an additional US$243.6 million fine.
The Justice Department expects to file the written agreement with Boeing by the end of next week. Boeing will no longer face oversight by an independent monitor under the agreement.
Boeing will pay in total over US$1.1 billion including the fine and compensation to families and over US$455 million to strengthen the company's compliance, safety, and quality programs, the Justice Department said.
'Boeing must continue to improve the effectiveness of its anti-fraud compliance and ethics programme and retain an independent compliance consultant,' the department said May 23. 'We are confident that this resolution is the most just outcome with practical benefits.'
Boeing did not immediately comment.
Reuters first reported on May 16 that Boeing had reached a tentative nonprosecution agreement with the government.
The agreement would forestall a June 23 trial date the planemaker faces on a charge it misled US regulators about a crucial flight control system on the 737 Max, its best-selling jet.
Boeing in July had agreed to plead guilty to a criminal fraud conspiracy charge after the two fatal 737 Max crashes in Indonesia and Ethiopia spanning 2018 and 2019, pay a fine of up to US$487.2 million (S$628.8 million) and face three years of independent oversight.
Boeing no longer will plead guilty, prosecutors told family members of crash victims during a meeting last week. The company's posture changed after a judge rejected a previous plea agreement in December, prosecutors told the family members.
Judge Reed O'Connor in Texas said in 2023 that 'Boeing's crime may properly be considered the deadliest corporate crime in US history.'
Boeing has faced enhanced scrutiny from the Federal Aviation Administration since January 2024, when a new Max 9 missing four key bolts suffered a mid-air emergency losing a door plug. The FAA has capped production at 38 planes per month.
DOJ officials in 2024 found Boeing had violated a 2021 agreement, reached during the Trump administration's final days, that had shielded the planemaker from prosecution.
That conclusion followed the January 2024 in-flight emergency during an Alaska Airlines' flight. As a result, DOJ officials decided to reopen the older fatal crashes case and negotiate a plea agreement with Boeing. REUTERS
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