U.S. securities officials fined Boeing $200 million for misleading assurances about the safety of the 737 MAX plane after two fatal crashes, regulators announced Thursday.
Boeing agreed to a fine to settle allegations it “recklessly violated anti-fraud provisions” of U.S. securities laws, the Securities and Exchange Commission said in a statement. Said, the company and its leader “put profits over people.”
Former Boeing chief executive Dennis Muilenburg also agreed to pay $1 million to settle the same allegations in a civil suit.
The settlement is the latest hit for Boeing over the MAX after the Lion Air crash in Indonesia in October 2018 and the Ethiopian Airlines crash in Ethiopia in March 2019, which together killed nearly 350 people.
A month after the first crash, a Boeing press release approved by Muilenburg “selectively highlighted certain facts,” implying that pilot error and poor aircraft maintenance contributed to the crash. .
The press release also confirmed the plane’s safety, noting that Boeing knew a critical flight handling system, the Maneuvering Characteristics Augmentation System (MCAS), had caused safety problems and had to be redesigned. had lived.
After the second accident, Boeing and Muilenburg assured the public that there were “no surprises or gaps” in MAX’s federal certification, despite being aware of conflicting information, the SEC said.
Boeing ‘failed’
“In times of crisis and tragedy, it is especially important that public companies and executives provide full, fair and truthful disclosures to the markets,” SEC Chairman Gary Gensler said in a press release.
“The Boeing Company and its former CEO, Dennis Muilenburg, failed in this fundamental responsibility. They misled investors by providing assurances about the safety of the 737 MAX despite knowing of serious safety concerns.
Boeing and Muilenburg, while both agreeing to pay the fines, neither acknowledged nor denied the agency’s findings, the SEC said.
Boeing said the settlement “fully resolves” the SEC’s inquiry and is part of the company’s “broader effort to responsibly resolve outstanding legal matters related to the 737 MAX accidents that have impacted our shareholders, employees and , and serve the best interests of other stakeholders,” a company spokesperson said.
“We will never forget those lost on Lion Air Flight 610 and Ethiopian Airlines Flight 302, and we have made broad and profound changes to our company in response to these accidents.”
Robert Clifford, an attorney representing the families of victims on the Ethiopian Airlines flight, “demanded that Muilenberg or anyone else who persuaded the government to keep the Boeing MAX 737 flying” conduct a “thorough investigation of this conduct.” be done which may be criminal in nature.”
US air safety officials have cleared Boeing’s 737 MAX to resume service in November 2020 after a 20-month grounding following the crash.
A primary cause of both accidents was identified as MCAS, which was supposed to prevent the aircraft from stalling during climb but instead forced the aircraft nose down. . The Federal Aviation Administration required Boeing to upgrade the system to fix the flaw.
In January 2021, Boeing agreed to pay $2.5 billion to settle a US criminal charge over fraudulent claims from regulators overseeing the 737 MAX.
