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US Justice Department strikes deal with Boeing that allows planemaker to avoid prosecution

The U.S. Justice Department announced on Friday that it had reached a deal with Boeing in principle to allow the company to avoid prosecution for a fraud case arising from two fatal crashes of 737 MAX aircraft, which killed 346 people.

Boeing will not be branded as a felon, and the agreement is a blow for families who have lost loved ones in crashes and had asked prosecutors to bring the U.S. aircraft manufacturer to trial. The Justice Department was urged by a lawyer representing family members as well as two U.S. Senators to continue its investigation. However, the government rejected their requests.

Boeing agreed to pay $444.5 in addition to the $243.6 million in fines into a fund for crash victims. The money would be distributed evenly among each crash victim.

The Justice Department anticipates filing the written agreement with Boeing before the end of the next week. Boeing will no long be subject to independent monitoring under the agreement.

The Justice Department announced that Boeing would pay a total of over $1.1 billion, including the fine, compensation for families, and over $455 millions to strengthen its compliance, safety and quality programs.

The department stated that Boeing must improve its anti-fraud compliance program, and retain an independent consultant. "We are confident this resolution will have practical benefits and is just," said the department.

Boeing has not yet commented.

First reported on 16 May that Boeing had reached an agreement to not prosecute with the government.

The agreement will prevent a trial scheduled for June 23 against the planemaker over a charge that it misled U.S. regulatory authorities about a critical flight control system in the 737 MAX jet, the company's best-selling model.

Boeing agreed in July to plead guilty in a criminal fraud charge following the two fatal 737 MAX crash in Indonesia and Ethiopia spanning between 2018 and 2019. The company will pay a maximum fine of $487.2 Million and be subject to independent oversight for three years.

Prosecutors told the family members of crash victim during a last-week meeting that Boeing would no longer plead guilty. Prosecutors told family members that the company's attitude changed after a December judge rejected an earlier plea agreement.

Judge Reed O'Connor, a Texas judge, said in 2023: "Boeing's crimes may be properly considered as the deadliest corporate crimes in U.S. history."

Boeing is under increased scrutiny by the Federal Aviation Administration, since January 2024 when a MAX 9 that was missing four bolts in a critical area suffered an emergency mid-air and lost a door plug. The FAA limits production to 38 planes per monthly.

DOJ officials found last year that Boeing violated an agreement reached in the final days of the Trump administration, which shielded Boeing from prosecution.

This conclusion was reached after the in-flight incident that occurred on an Alaska Airlines flight in January 2024. In response, DOJ officials decided that they would reopen an older fatal crash case and negotiate with Boeing a plea deal. (Reporting and editing by Chris Reese, Diane Craft and David Shepardson)

(source: Reuters)