Boeing Company admitted that two of its 737 MAX test pilots fraudulently deceived the Federal Aviation Administration (FAA). As a result of the Boeing MAX fraud, the aviation industry giant has agreed to pay a $2.5 billion fine according to the U.S. Department of Justice (DOJ), which announced the deal. It said that Boeing agreed to pay the fine to avoid prosecution over a criminal charge of conspiracy to defraud the U.S. The DOJ filed the criminal information in the Northern District of Texas today after completing a criminal probe surrounding the two fatal crashes of the Boeing MAX involving Lion Air flight 610 and Ethiopian Airlines flight 302. The two crashes, which occurred in October 2018 and March 2019, respectively, claimed 346 lives.
“For years, Boeing’s focus has been solely on the company’s bottom line and it has consistently prioritized profits over human life,” said Beasley Allen airplane accident lawyer Mike Andrews who represents families in the Boeing litigation. “Holding Boeing accountable for its callous, profit-driven behavior in rushing a defective and dangerous aircraft into commercial service is a step in the right direction. This settlement with the Department of Justice cannot bring back those who were killed in the two deadly MAX flights but it sends a message that such indifference for human life and such intentional deception will not be tolerated. Ultimately our clients are seeking accountability and real changes in aviation safety.”
A statement by the DOJ related to the Boeing MAX fraud said, “Boeing will pay a total criminal monetary amount of over $2.5 billion, composed of a criminal monetary penalty of $243.6 million, compensation payments to Boeing’s 737 MAX airline customers of $1.77 billion, and the establishment of a $500 million crash-victim beneficiaries fund to compensate the heirs, relatives, and legal beneficiaries of the 346 passengers who died in the Boeing 737 MAX crashes… .”
During an evaluation of the Boeing MAX by the FAA’s Aircraft Evaluation Group (AEG), two of Boeing’s MAX test pilots lied to the FAA AEG about a key component of the aircraft – the Maneuvering Characteristics Augmentation System (MCAS). The MCAS impacted the MAX’s flight control system and was determined to be at the center of a similar series of events that led to the crash of both flight 610 and flight 302. These findings were comparable across several investigations.
Boeing conspiracy investigation
The DOJ’s investigation into the Boeing MAX fraud revealed that the two pilots learned about an important change to the MCAS “in and around November 2016,” which was two years before the first fatal crash. One of those pilots was then the 737 MAX Chief Technical Pilot and the other would later become the 737 MAX Chief Technical Pilot. However, instead of sharing this information with FAA AEG regulators, the test pilots buried the information, leading the FAA AEG to delete “all information about MCAS from the final version of the 737 MAX FSB Report published in July 2017.” Nothing about the MCAS would be included in the airplane manuals and pilot training materials for U.S.-based airlines. Pilots flying the 737 MAX for Boeing’s airline customers would not have this information, nor would they be aware of the MCAS until after the Lion Air crash. Even then, Boeing attempted to deny the MCAS or any other part of the aircraft was faulty. Further, Boeing failed to take steps to improve the aircraft’s safety.
Five months later, flight 302 crashed under similar circumstances and within days, the MAX was grounded worldwide for the next 20 months. The U.S. was one of the last countries to ground the MAX but in November 2020, it was the first country to lift the ban on the aircraft despite objections and outcries from family members of those who perished in the two crashes.
While the FAA asserts that Boeing has implemented enough changes to make the MAX safe for resuming commercial service critics believe it is “business as usual” for Boeing and the FAA. Their argument gained support from the U.S. Senate, which announced findings from its own investigation of the two crashes in November 2020. A detailed report of the findings cited “a number of significant lapses in aviation safety oversight and failed leadership in the FAA.” The findings further support critics’ claims that Boeing and the FAA had a “cozy relationship” that intensified the weakened FAA oversight authority and reinforced Boeing’s ability to “self-certify” its aircraft.
The Boeing 737 MAX crash tragedies prompted the federal government to enact reforms in how the FAA certifies newly designed aircraft. The law restored some of the oversight authority the agency had conceded to the powerful aviation industry for years.
As part of its agreement with the DOJ regarding the Boeing MAX fraud, Boeing will comply with ongoing or future investigations and prosecutions and will “report any evidence or allegation of a violation of U.S. fraud laws committed by Boeing’s employees or agents upon any domestic or foreign government agency (including the FAA), regulator, or any of Boeing’s airline customers.” It also “agreed to strengthen its compliance program and to enhanced compliance program reporting requirements.”
Mike handles all types of aviation litigation for the firm, involving both civilian and military aircraft.