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Justice Department Accuses Boeing of Breaching Deal to Resolve 737MAX Crash Criminal Prosecution

Justice Department Accuses Boeing of Breaching Deal to Resolve 737MAX Crash Criminal Prosecution

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The Department of Justice (DOJ) has accused the embattled aircraft manufacturer Boeing of breaching a 2021 deal to resolve a criminal prosecution over the 737MAX crashes of Lion Air Flight 610 and Ethiopian Airlines Flight 302.

The deal, known as a Deferred Prosecution Agreement (DPA), was reached between the Fraud Section of the DOJ and Boeing in January 2021 and required the manufacturer to pay a total criminal monetary amount of over $2.5 billion.

Under the DPA, Boeing was required to tell the DOJ of any allegation or report any evidence of a breach of fraud laws committed by its employees or agents. Boeing was also required to strengthen its compliance programs to avoid allegations of fraud in the future.

The compliance program was meant to be “reasonably designed, implemented, and enforced” so as to avoid committing fraud against government agencies such as the Federal Aviation Administration (FAA) and its customers.

On Tuesday, however, the DOJ accused Boeing of failing to “design, implement, and enforce” a working compliance and ethics program that could actually prevent and detect violations of the U.S. fraud laws.

As a result of the finding, the Justice Department may now open a criminal prosecution into the Lion Air and Ethiopian Airlines crashes that killed 346 people.

A criminal prosecution would focus on “the fraudulent and deceptive conduct” of Boeing employees who helped to convince regulatory officials and airline customers that there wasn’t any major difference between the best-selling 737NG and 737MAX.

In fact, there was a major difference in the Maneuvering Characteristics Augmentation System (MCAS) that had been added to the 737MAX and which significantly impacted the flight control system.

In March, it was revealed that the DOJ had opened a criminal probe into Boeing’s conduct following the mid-cabin exit plug blowout on an Alaska Airlines Boeing 737MAX in January.

Since that incident, Boeing has been the subject of a number of whistleblower allegations over safety and compliance.

In response to Tuesday’s court filing, Boeing commented: “We believe that we have honored the terms of that agreement, and look forward to the opportunity to respond to the Department on this issue.”

“As we do so, we will engage with the Department with the utmost transparency, as we have throughout the entire term of the agreement, including in response to their questions following the Alaska Airlines 1282 accident.”

The DOJ hasn’t yet made a final determination over whether it will open a criminal prosecution and has given Boeing until June to respond to its accusation. A final decision isn’t expected until July.

Observers say the DOJ may stop short of opening a full criminal prosecution and may instead seek to impose a bevy of new fines and legal requirements on Boeing.

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