Boeing to be Charged with Fraud: Reports

The U.S. Department of Justice will reportedly charging Boeing with criminal fraud relating to two fatal crashes of its 737 Max airplanes.

Criminal charges being brought against Boeing would represent the culmination of a painful period for the aerospace giant, who has been at the center of extreme scrutiny since a poorly installed door plug blew out of an Alaska Airlines plane mid-flight in January. However, according to a Bloomberg report, a lawyer for the victims' families said that the DoJ will be offering the company a "sweetheart plea deal," that will see Boeing avoid culpability for the fatal crashes in 2018 and 2019 that killed 346 people.

The imminent charges date back to two fatal Boeing 737 crashes in 2018 and 2019.

In October 2018, a domestic flight from Tangerang, Indonesia to Pangkal Pinang crashed into the Java Sea 13 minutes after takeoff. All 189 people onboard, including 181 passengers and eight crew members, were killed.

Six months later, a Boeing 737 Max 8 crashed after taking off from Addis Ababa on its way to Nairobi, Kenya.

All 157 people onboard, including 149 passengers and eight crew members, were killed.

Since then, families of the victims have been seeking compensation from the company, and assurances that the safety issues which plague Boeing will be addressed.

According to a letter sent last week by a lawyer for families of the crash victims, the maximum possible fine for Boeing would be $24.8 billion.

The letter justified the high penalty, calling Boeing's the "deadliest corporate crime in U.S. history."

On Monday, Paul Cassell, a lawyer representing victims of the fatal crashes told the BBC that the U.S. Government will offer Boeing a "sweetheart plea deal," which includes a fine, three years of probation and independent safety audits.

Newsweek has contacted Cassell for further comment on the deal.

Reuters reported that the DoJ revealed its decision during a call with the victims' family members on Sunday, and that the plea deal will include a $487.2 million fine, well below what was demanded by the families in June.

The deal will require Boeing to plead guilty to defrauding the Federal Aviation Administration in connection with the Indonesian and Ethiopian airline crashes.

Boeing now has until the end of the week to decide whether to plead guilty, or face going to trial.

Cassell added that the families of the victims "will strenuously object to this deal."

In January 2021, the Department of Justice charged Boeing with fraud for misleading regulators into approving the 737 Max, which may have led to the two fatal crashes.

Prosecutors approved a deferred prosecution agreement, which would guard the company against criminal liability for three in exchange for paying a $2.5 billion fine and remodeling its compliance practices.

However, last month, an investigation found that the company had "breached its obligations" under the 2021 settlement, and had failed to "design, implement, and enforce a compliance and ethics program to prevent and detect violations of the U.S. fraud laws throughout its operations."

Boeing denied the charges.

Newsweek has contacted the Department of Justice and the Federal Aviation Administration for comment.

The DoJ then had until July 7 to bring criminal charges against the company.

The news coincides with Boeing announcing that it will be purchasing Spirit AeroSystems, a company with which Boeing frequently collaborates and which made the fuselage that blew out of the Alaska Airlines 737 Max in January.

Dave Calhoun, outgoing Boeing CEO, said: "By reintegrating Spirit, we can fully align our commercial production systems, including our Safety and Quality Management Systems, and our workforce to the same priorities, incentives and outcomes – centered on safety and quality."

Newsweek has contacted Boeing by email and phone for comment.

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