US prosecutors are reportedly recommending to senior Justice Department officials that criminal charges be brought against Boeing.
Prosecutors are suggesting charges after finding that the plane maker violated an agreement related to two fatal crashes, two people familiar with the matter told Reuters.
In May, officials determined that the company violated a 2021 agreement that had protected Boeing from a criminal charge of conspiracy to commit fraud stemming from two fatal crashes in 2018 and 2019 involving the 737 MAX aircraft.
Under the 2021 settlement, the Justice Department agreed not to prosecute Boeing over allegations of defrauding the Federal Aviation Administration as long as the company reviewed its compliance practices and filed regular reports. Boeing also agreed to pay $2.5 billion to resolve the investigation.
The sources did not specify what criminal charges Justice Department officials are considering, but one of the people said they could extend beyond the original 2021 fraud conspiracy charge.
Prosecutors are recommending criminal charges against Boeing for violating an agreement stemming from two fatal crashes in 2018 and 2019 involving the 737 MAX plane.
Alternatively, instead of prosecuting Boeing, the Justice Department could extend the 2021 deal by a year or propose new, stricter terms, the sources said.
In the two crashes, in Indonesia in 2018 and in Ethiopia in 2019, MCAS automatically pointed the plane’s nose down based on faulty sensor readings, and the pilots were unable to regain control.
On October 29, 2018, the Boeing 737 MAX operating Lion Air Flight 610 crashed into the Java Sea 13 minutes after takeoff, killing all 189 passengers and crew.
Five months later, on March 10, 2019, the Boeing 737 MAX 8 aircraft operating Ethiopian Flight 302 crashed near the city of Bishoftu, Ethiopia, six minutes after takeoff, killing all 157 people on board.
Investigations into the 2018 and 2019 crashes pointed to a flight control system that Boeing added to the Max without notifying pilots or airlines.
Boeing downplayed the importance of the system and did not review it until after the second accident.
The Department of Justice investigated Boeing and settled the case in January 2021.
On October 29, 2018, the Boeing 737 MAX operating Lion Air Flight 610 crashed into the Java Sea 13 minutes after takeoff, killing all 189 passengers and crew.
On March 10, 2019, the Boeing 737 MAX 8 aircraft operating Ethiopian Flight 302 crashed near the city of Bishoftu, Ethiopia, six minutes after takeoff, killing all 157 people on board.
After secret negotiations, the government agreed not to prosecute Boeing for defrauding the United States by misleading regulators who approved the plane.
In exchange, the company paid $2.5 billion: a $243.6 million fine, a $500 million fund for compensation to victims, and nearly $1.8 billion to the airlines whose Max planes were grounded.
Boeing has faced civil lawsuits, congressional investigations and massive damage to its business since the crashes in Indonesia and Ethiopia.
Glenn Leon, chief of the fraud section of the Justice Department’s criminal division, said in a letter filed in federal court in Texas that Boeing made no changes to prevent it from violating federal anti-fraud laws, a condition of the 2021 deal.
The department claims that Boeing failed to “design, implement and enforce a compliance and ethics program to prevent and detect violations of United States fraud laws,” according to NBC.
Boeing could now be prosecuted “for any federal criminal violation of which the United States is aware,” including the fraud charge the company hoped to avoid with the $2.5 billion settlement, the Justice Department said.
Relatives of victims of the two fatal 737 MAX crashes have long criticized the 2021 agreement
Boeing said: “We can confirm that we received a communication from the Department of Justice today, indicating that the Department has determined that we have not met our obligations under our 2021 deferred prosecution agreement and requesting the company’s response.”
‘We believe we have met the terms of that agreement and look forward to having the opportunity to respond to the Department on this matter.
“In doing so, we will engage with the Department with the utmost transparency, as we have done throughout the life of the agreement, including in response to its questions following the Alaska Airlines 1282 crash.”
Relatives of victims of the two fatal 737 MAX crashes have long criticized the 2021 settlement, arguing that Justice Department officials should have prosecuted the company and its executives.
The Justice Department will decide whether to file charges, amid growing scrutiny over the safety of the company’s planes, by July 7.