Boeing Agrees Guilty Plea Over 737 Max Crash Violations

Boeing will admit guilt to fraud for breaching the agreement related to the 737 Max crashes.

Boeing has agreed to plead guilty to criminal conspiracy to defraud the United States following a Justice Department investigation. This action comes after the aircraft manufacturer failed to adhere to a previous settlement regarding two fatal crashes involving its 737 Max jetliner.

According to the deal with US prosecutors:

  • Boeing could potentially face a criminal fine of up to $487.2 million (€450 million), the maximum allowed by law, with the final amount to be determined by a judge.
  • The company is required to appoint a corporate monitor and allocate a minimum of $455 million towards enhancing its compliance and safety programs over the next three years, pending court approval.
  • Boeing will also be under three years of court-monitored probation.

This admission of guilt marks a significant blow to the company’s reputation in the aftermath of the 2018 and 2019 crashes involving its 737 Max planes, resulting in the tragic loss of 346 lives. The agreement could assist Boeing in avoiding the distraction of a criminal trial amid financial uncertainty and leadership changes.

Boeing did not provide an immediate response. In June, the aircraft manufacturer informed prosecutors of its disagreement with the conclusion that it had breached the previous agreement. The Justice Department found in May that Boeing had violated a deferred-prosecution agreement from 2021, which was related to the crashes that occurred near the end of the Trump administration.

Under the terms of the 2021 agreement, Boeing paid a criminal fine of $243.6 million and confessed to misleading the Federal Aviation Administration regarding a flight control system associated with the accidents. The company also committed to enhancing its internal safety protocols. In exchange, the US government would drop a criminal charge against the company after three years.

Critics, including families of crash victims, disapproved of the agreement as they were not consulted before its announcement.

Just before the agreement’s expiration, an Alaska Airlines 737 Max 9 jet experienced a fuselage panel detachment in early January. Subsequently, it was found that Boeing had not adhered to a requirement of the 2021 deal to establish an effective compliance program to prevent and identify violations of US fraud laws.