Boeing to plead guilty to defrauding US over plane crashes

Boeing will plead guilty to conspiracy to defraud the US government stemming from two plane crashes of its 737 MAX jetliners that killed 346 people and pay $487.2 million in fines, the US Justice Department (DOJ) said.

The airplane manufacturer confirmed that it had reached the deal with the DOJ in a court filing Sunday evening and had no further comment.

Federal prosecutors alleged Boeing committed conspiracy to defraud the government by misleading regulators about a flight-control system that was implicated in the crashes, which occurred in Indonesia in October 2018 and in Ethiopia less than five months later.

Companies with felony convictions can be suspended or barred as US defense contractors. The company was awarded Defense Department contracts last year valued at $22.8 billion, nearly 40 percent of its revenue, according to federal data.

In addition to the $487.2 million in fines — the maximum allowed by law — Boeing agreed to invest at least $455 million over the next three years to strengthen its compliance and safety programs, the DOJ said.

Boeing's decision to plead guilty doesn't provide immunity to any employees or corporate executives.

The plea deal covers only wrongdoing by Boeing before the two crashes. It doesn't give Boeing immunity for other incidents, including a panel that blew off a MAX jetliner during an Alaska Airlines flight in January, a DOJ official said.

The company will be put on probation for three years, supervised by the US District Court for the Northern District of Texas.

The DOJ said it expected to file the written plea agreement with the court by July 19. The judge overseeing the case in Texas could accept the agreement or reject it, likely leading to new negotiations between the DOJ and Boeing.

The agreement also requires Boeing's board of directors to meet with families of the crash, who were briefed a week ago on the outlines of the deal.

They oppose the deal and want the aircraft maker to pay $24.8 billion, the DOJ said.

"The families are highly disappointed that the DOJ fails to account for the two crashes," said Robert Clifford in a statement to China Daily on Monday. Clifford is the lead counsel for families in the civil litigation pending in US District Court in Chicago.

"Much more evidence has been presented over the last five years that demonstrates that the culture of Boeing putting profits over safety hasn't changed. This plea agreement only furthers that skewed corporate objective," Clifford said.

Paul Cassell, a lawyer for more than a dozen of the families, told The New York Times that they had sought an admission of fault in the deaths of those killed in the crashes and had hoped for stiffer consequences for the company and its executives, including a trial.

"This sweetheart deal fails to recognize that because of Boeing's conspiracy, 346 people died," he said. "Through crafty lawyering between Boeing and the DOJ, the deadly consequences of Boeing's crime are being hidden."

Family members of some victims on Monday gave CNN statements that blasted the plea agreement.

"Miscarriage of justice is a gross understatement in describing this," said a statement from Zipporah Kuria of England, who lost her father, Joseph, in the Ethiopian Airlines crash. "It is an atrocious abomination."

"Without full transparency and accountability nothing will change," said a statement from California resident Ike Riffel, who lost his two sons, Melvin and Bennett, in the crash. "With this deal, there will be no investigation, there will be no expert witness testimony, there will be no perpetrators of these crimes to answer the charges in court."

Agencies contributed to this story.