Boeing to pay $2.5 billion penalty for 737 MAX accidents.
Boeing will pay more than $2.5 billion to resolve the U.S. Justice Department’s investigation into the two 737 MAX accidents that killed 346 people, but will not be forced to plead guilty to criminal charges, the Justice Department said.
See also: American Airlines restarts commercial flights with 737 MAX.
Both parties reached an agreement that includes a criminal monetary penalty of $243.6 million, compensation payments to the airlines of $1.77 billion and the establishment of a $500 million fund for the beneficiaries of the accident victims to compensate the heirs, family members and legal beneficiaries of the passengers, Reuters reported.
See also: When does United Airlines plan to fly 737 Max again?
The accidents caused the plane to be grounded for 20 months in March 2019, and it was only lifted in November after Boeing made major safety improvements.
Boeing was charged with conspiracy to defraud by concealing information about the 737 Max models. The largest U.S. aircraft manufacturer faces a three-year deferred prosecution agreement after which the charge will be dismissed if the company complies with the agreement.
“The tragic accidents of Lion Air Flight 610 and Ethiopian Airlines Flight 302 exposed the fraudulent and deceptive conduct of employees of one of the world’s largest commercial aircraft manufacturers,” said Acting Deputy Attorney General David P. Burns. “Boeing employees chose the path of profit over candor by withholding material information from the FAA about the operation of their 737 Max aircraft and participating in an effort to cover up their deception.
Boeing admitted in court documents that two of its 737 MAX test pilots misled the Federal Aviation Administration about a key safety system related to both fatal accidents called MCAS.
Boeing Chief Executive Officer David Calhoun said in a statement that the agreement “appropriately recognizes how we fell short of our values and expectations.
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