Boeing has secured a new plea deal to resolve a fresh US criminal investigation linked to two fatal 737 MAX crashes that will see the planemaker admit a fraud charge.
An official at the US Department of Justice (DoJ) revealed overnight that Boeing would pay a £243.6m (£190.1m) fine and invest at least $455m over three years to strengthen its safety and compliance programs as part of the settlement.
The deal, which Boeing was yet to comment on, marks the second time Boeing has been offered a plea bargain by the department relating to the crashes of 2018 and 2019 that were blamed on flawed flight control software.
A total of 346 people died in the incidents which involved a Lion Air MAX 8 flight in Indonesia and then, six months later, Ethiopian Airlines Flight 302 outside Addis Ababa.
Relatives of those killed, who accused US authorities of letting Boeing off the hook through a $2.5bn settlement in 2021, had demanded last month a fresh fine of almost $25bn (£19.7bn).
They also sought the imposition of criminal proceedings.
The new settlement with the DoJ, which was described by a lawyer for the families as a “sweetheart deal”, will ensure there is no trial.
Officials filed a case in May which accused the planemaker of breaching the terms of the deferred prosecution agreement in 2021.
American investigators search through debris after Ethiopian Airlines Flight 302 came down outside Addis Ababa. Pic: Reuters
The terms of that deal were due to expire in January this year but, two days beforehand, a Boeing 737 MAX 9 aircraft operated by Alaska Airlines suffered a mid-air panel blowout.
The incident has been the subject of multi-agency investigations, including by the DoJ, since.
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Boeing CEO: ‘We fly safe planes’
Boeing denied that it had violated the terms of the deferred prosecution agreement through its production practices ahead of the MAX 9 Alaska Airlines accident.
While the guilty plea to a conspiracy to defraud charge and sums to be paid under the latest deal will come as a blow to the families, the terms are yet to be ratified in court.
The deal also potentially threatens Boeing’s ability to secure lucrative government contracts.
The agreement only covers Boeing’s conduct before the fatal crashes and does not shield the company from any other potential investigations or charges related to the January incident or other conduct.
Boeing is pleading guilty to making knowingly false representations to the Federal Aviation Administration about having expanded a key software feature used on the MAX to operate at low speeds.
The new software saved Boeing money by requiring less intensive training for pilots.
The company has always denied placing profits before safety.