American multinational corporation, Boeing has been criminally charged by the Department of Justice for conspiracy to defraud the United States. The company which designs manufactures and sells airplanes, rotorcraft, rockets, satellites telecommunications equipment and missiles worldwide will be required to pay a $2.5 billion penalty for lying to the Federal Aviation Administration before and after the deadly 737 Max crashes in 2018 and 2019.
The charges and fines which were part of a deferred prosecution agreement were announced by the Justice Department on Thursday. The DPA requires Boeing to pay a $2.5 billion fine covers a $243.6 million “criminal monetary penalty,” $1.77 billion which will be paid out to airlines that were customers of the plane, and $500 million which will be transferred to a fund to help families and relatives of the crash victims who died in the Boeing 737 Max crashes of Lion Ai Flight 610 and Ethiopian Airlines Flight 302.
“The misleading statements, half-truths, and omissions communicated by Boeing employees to the FAA impeded the government’s ability to ensure the safety of the flying public. This case sends a clear message: The Department of Justice will hold manufacturers like Boeing accountable for defrauding regulators – especially in industries where the stakes are this high,” US Attorney Erin Nealy Cox said in a statement.
Boeing created the 737 Max to help the company keep pace with a “new, more fuel-efficient offering from rival Airbus”, but rushed the design which led to the plane’s exposure to dangerous stalls in certain takeoff situations. Boeing further designed a piece of software to prevent this design defect by automatically pushing the plane’s nose down. However, the company failed to inform the FAA, airlines, or pilots about the software to enable them to save time and money. More so, there was no way to tell if the software was acting with bad information or if the sensor was damaged.
It was later discovered in subsequent Congressional investigations and reporting that these series of design flaws and Boeing’s lack of honesty was what led to the two fatal 737 Max crashes. In 2020, the Congres released proof that some of the employees were fully aware of the wrong doings as was documented in internal chat messages and emails. The company put lives at risk by leaving the pilots of Lion Air flight 610 and Ethiopian Airlines flight 302 to deal with a software they didn’t even know existed.
The Verge reports, Boeing has ensured that the 737 Max problems have been fixed and airlines are gradually welcoming the plane back into their fleets, which has since allowed the plane back into the air. However, it was revealed in a Senate report released last month that Boeing and the FAA altered some of the tests that were carried out during the recertification process. Therefore, the FAA’s nonchalant approach to regulation has also been held responsible for aiding to problems that led to the two deadly 737 Max crashes.
“This settlement amounts to a slap on the wrist and is an insult to the 346 victims who died as a result of corporate greed. Not only is the dollar amount of the settlement a mere fraction of Boeing’s annual revenue, the settlement sidesteps any real accountability in terms of criminal charges. I hope the DOJ can explain its rationale for this weak settlement to the families, because from where I sit this attempt to change corporate behavior is pathetic and will do little to deter criminal behavior going forward.” Peter DeFazio (D-OR), the Chairman of the House Committee on Transportation and Infrastructure, said in a statement.
The government investigation which was led by the FBI and the Department of Transportation’s Office of the Inspector General is yet to lead to any individual being criminally charged.
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