Washington Justice Department pushes for criminal charges over deadly crashes

The US Justice Department is preparing to criminally charge Boeing with fraud related to two fatal crashes involving its 737 MAX jets, demanding the aerospace giant plead guilty or face a trial, according to sources familiar with the matter.

On Sunday, the Justice Department planned to offer Boeing a plea agreement, which includes a hefty financial penalty and the appointment of an independent monitor to oversee the company’s safety and compliance practices for three years. Boeing has until the end of the week to respond to the nonnegotiable offer.

The decision to pursue charges stems from Boeing’s alleged violation of a 2021 agreement that previously shielded it from prosecution over the crashes, which occurred in 2018 and 2019 and resulted in the deaths of 346 people. Reuters first reported the Justice Department’s move.

The plea deal would require Boeing to admit to conspiring to defraud the U.S. Federal Aviation Administration (FAA) concerning the fatal crashes. This development amplifies the crisis facing Boeing, potentially affecting its financial standing and eligibility for government contracts, including those with the U.S. military.

Justice Department officials disclosed their decision to victims’ families in a call earlier on Sunday. The proposed agreement mandates a $487.2 million financial penalty, with Boeing only required to pay half due to a prior settlement payment. Additionally, Boeing may face restitution determined by a judge and a three-year probation period. The deal also requires Boeing’s board to meet with victims’ relatives.

Victims’ families expressed outrage during the call, feeling the proposed plea deal inadequately holds Boeing accountable. Erin Applebaum, an attorney representing some families, condemned the agreement, calling the financial penalty “negligible” and pledging to oppose the deal in court.

“The 737 MAX families vigorously oppose the shameful new sweetheart deal between Boeing and the Department of Justice,” Applebaum stated, reflecting the families’ demand for stiffer penalties and additional charges against Boeing.

The Justice Department, under Attorney General Merrick Garland, has sought to improve transparency with victims’ families after criticism over the initial 2021 agreement, which victims’ families learned of post-negotiation.

Earlier this year, Boeing CEO Dave Calhoun faced tough questions from U.S. lawmakers over the company’s safety record. Victims’ lawyers have leveraged this criticism in urging the Justice Department to seek a substantial fine of up to $24.78 billion.

Boeing previously paid $2.5 billion in a deal that granted it immunity from prosecution related to the 737 MAX’s design flaws.

This deferred prosecution agreement expired in January, but the Justice Department’s May finding that Boeing breached the agreement has now paved the way for potential criminal prosecution.