Updated: Jan 8
Boeing Charged with 737 Max Fraud Conspiracy and Agrees to Pay over $2.5 Billion
Boeing has agreed to pay $2.5bn (£1.8bn) to settle US criminal charges that it hid information from safety officials about the design of its 737 Max planes.
The US Justice Department said the firm chose "profit over candour", impeding oversight of the planes, which were involved in two deadly crashes.
About $500m will go to families of the 346 people killed in the tragedies.
Boeing said the agreement acknowledged how the firm "fell short".
Investors are getting worried, as the market reacted and families of the victims pursue civil litigation.
"This settlement is protection for Boeing rather than justice, as it is a continuation of Boeing evading accountability and transparency," said Michael Stumo, whose daughter died in the MAX crash in Ethiopia.
Stock down about 2.5% in after hour trading.
CHICAGO (Reuters) - Relatives of Boeing (NYSE:BA) Co 737 MAX crash victims on Tuesday urged the European Union Aviation Safety Agency (EASA) to delay approving the aircraft's return to service, saying there are unanswered questions about its safety.
Last month, the U.S. Federal Aviation Administration cleared the jet following design changes around systems involved in two crashes that together killed 346 people in 2018 and 2019, sparking a global grounding and safety reviews.
US Senate investigators say that Boeing officials "inappropriately coached" test pilots during efforts to recertify the company's 737 Max aircraft.
"time to put them in prison”? never happens, but no excuses anymore, too many cover ups on this, Boeing. Stock swoons.
The planes were grounded in March 2019 following two deadly crashes.
Investigators accused Boeing and Federal Aviation Administration (FAA) officials of "attempting to cover up important information".
Boeing said it was reviewing the findings and took them "seriously", while the FAA defended its conduct.
The FAA said the Senate Commerce Committee's report contained "a number of unsubstantiated allegations", and that its review of the 737 Max had been thorough. It said it was confident that safety issues with the aircraft had been addressed.
The crashes in Indonesia and Ethiopia came within five months of each other and together killed 346 people. They have been attributed to flaws in automated flight software called MCAS, which prompted the planes to nosedive shortly after take-off.
"Boeing officials inappropriately coached test pilots in the MCAS simulator testing contrary to testing protocol," it said. "It appears, in this instance, FAA and Boeing were attempting to cover up important information that may have contributed to the 737 Max tragedies."
Boeing said Friday it took the committee’s findings “seriously” and would “continue to review the report in full”.
The FAA said Friday it was “carefully reviewing the document, which the committee acknowledges contains a number of unsubstantiated allegations”.
How is the market going to react, ok we see the potential end of COVID and we may start travelling again end of next year, but it seems bad after bad news at the moment for Boeing.
How will the market react Monday morning? I guess intraday traders will have a ball.