Prosecutors Recommend Criminal Charges Against Boeing

AP Photo/Lewis Joly

United States prosecutors are reportedly recommending that the Justice Department bring criminal charges against airplane manufacturer Boeing. The suggestion is based on a finding that the company allegedly violated a settlement related to two plane crashes, according to a Reuters exclusive.

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The DOJ is expected to decide by July 7 whether to seek criminal charges against Boeing.

In May, officials determined the company breached a 2021 agreement that had shielded Boeing from a criminal charge of conspiracy to commit fraud arising from two fatal crashes in 2018 and 2019 involving the 737 MAX jet.

Under the 2021 deal, the Justice Department agreed not to prosecute Boeing over allegations it defrauded the Federal Aviation Administration so long as the company overhauled its compliance practices and submitted regular reports. Boeing also agreed to pay $2.5 billion to settle the investigation.

The two sources told Reuters that the DOJ and Boeing are working toward “a potential resolution” so it is possible that there will be no charges filed. They two individuals did not mention precisely which charges Boeing could be facing, but they “could extend beyond the original 2021 fraud conspiracy charge.”

Alternatively, instead of prosecuting Boeing, the DOJ could extend the 2021 settlement by a year or propose new, stricter terms, the sources said.

In addition to financial penalties, the strictest settlements typically involve installing a third party to monitor a company's compliance. The DOJ can also require the company to admit its wrongdoing by pleading guilty.

Boeing may be willing to pay a penalty and agree to a monitor, but believes a guilty plea, which typically incurs additional business restrictions, could be too damaging, said one of the sources. Boeing derives significant revenue from contracts with the U.S. government, including the Defense Department, which could be jeopardized by a felony conviction, one of the sources said.

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This development comes as Boeing faces increased scrutiny due to a series of mishaps involving its planes and allegations that it is not doing enough to ensure the safety of travelers.

Multiple whistleblowers have come forward to denounce Boeing’s quality control practices. Sam Mohawk, one of the more recent employees, told lawmakers that he saw others ignore safety procedures for “nonconforming parts at Boeing Renton facility where the 737 MAX is manufactured.”

In May it was revealed that some Boeing employees allegedly falsified records to conceal shortcuts they were taking when manufacturing a wing attachment.

The company disclosed on Monday that it had alerted authorities to potentially incomplete inspections on the long-haul jetliner, setting in motion an investigation by the US Federal Aviation Administration. While the latest mishaps don’t create an immediate flight safety issue, they will disrupt factory operations as Boeing conducts tests on aircraft being assembled.

Potentially the most damaging revelation was the suspicion that workers at the factory in North Charleston, South Carolina, may have falsified records to cover up their shortcuts. A review revealed that “several people” had not performed a required test during the wing attachment to the aircraft body but recorded that work as having been completed, according to Boeing.

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Other whistleblowers have reported being told to keep quiet after bringing their concerns to management. “I was told, frankly, to shut up,” one of the individuals said.

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