Clouds. 42   F New York
AI-Powered News Summarizer
World

Boeing agrees to pay $2.5 billion to settle charges it defrauded FAA on 737 Max

January 7, 2021. Summarized by summa-bot.

Compression ratio: 65%. 2 min read.

A Boeing Co. 737 MAX 9 jetliner sits on the production floor at the company's manufacturing facility in Renton, Washington, U.S., on Monday, Feb. 13, 2017. Boeing Co. is laying plans to expand the family of 737 Max jetliners with a new version tailor-made for transcontinental flights even as the first of the upgraded single-aisle models nears its market debut. Photographer: David Ryder/Bloomberg via Getty Images

Boeing reached a $2.5 billion settlement with the Justice Department on Thursday to settle criminal charges that the company defrauded the Federal Aviation Administration when it first won approval for the flawed 737 Max jet.

New York (CNN Business)Boeing reached a $2. 5 billion settlement with the Justice Department on Thursday to settle criminal charges that the company defrauded the Federal Aviation Administration when it first won approval for the flawed 737 Max jet.

"The misleading statements, half-truths, and omissions communicated by Boeing employees to the FAA impeded the government's ability to ensure the safety of the flying public," said US Attorney Erin Nealy Cox for the Northern District of Texas.

"This case sends a clear message: The Department of Justice will hold manufacturers like Boeing accountable for defrauding regulators — especially in industries where the stakes are this high. "

The government's filing against the company said that at least two Boeing employees, who were not identified, engaged in the fraud from late 2016, in the final stages of the jet's approval, through late 2018, when the plane was already in use and after the first crash had occurred.

According to the filing, at least one of the two employees left Boeing in July 2018 to work for an airline.

The settlement includes a $243. 6 million criminal fine, compensation payments of $1. 77 billion to Boeing's airline customers and an additional $500 million to a fund to compensate family members of crash victims.

Boeing had previously already set aside money to pay airlines and $100 million for victims' families.

Under the deal, the Justice Department would defer any criminal prosecution of Boeing for three years and charges will be dismissed if it it sees no more misdeeds by the company.

"I firmly believe that entering into this resolution is the right thing for us to do — a step that appropriately acknowledges how we fell short of our values and expectations," said Boeing CEO Dave Calhoun.

The settlement payments are modest compared with what the scandal has cost Boeing over the last two years.

Boeing has already detailed $20. 7 billion in direct costs in compensation to airlines, increased production costs, storage fees and victim compensation, even before these latest charges.

Summarizer is on Google News. Now you can get the latest AI summarized news on your favorite news platform.

Don't like Google News? We have an RSS Feed for you.

Suggestions