An aerial view of several Boeing 737 MAX airplanes parked at King County International Airport-Boeing Field in Seattle, Washington, U.S, June 1, 2022.
Image: Lindsey Wasson / Reuters
Boeing reached a $200 million settlement with U.S. securities regulators Thursday to resolve an investigation into claims that the aircraft manufacturer and a former CEO had deceived investors about problems with its 737 Max plane that led to two deadly crashes in 2018 and 2019.
The company’s CEO at the time, Dennis Muilenburg, agreed to pay a $1 million fine as part of a separate settlement with the Securities and Exchange Commission, although the facts of the case were largely the same.
In the settlement agreement, the SEC said Boeing and Muilenburg had misled investors after the first jet crashed in Indonesia in 2018 by suggesting that human error was to blame, and omitting the company’s own concerns with the plane’s flight control system. Boeing made further misleading statements about the safety of the planes after a second plane crashed in Ethiopia a few months later, the SEC said.
“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 Chair Gary Gensler said in a statement. “The Boeing Company and its former CEO, Dennis Muilenburg, failed in this most basic obligation.”
The company settled without admitting or denying the facts of the case. In a statement, Boeing said that it had improved “safety processes and oversight of safety issues” since the crashes and that the settlement was part of a “broader effort to responsibly resolve outstanding legal matters” related to the Max.
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The aircraft manufacturer last year reached a $2.5 billion settlement with federal prosecutors as part of a deferred prosecution agreement. That deal resolved a criminal charge that Boeing had conspired to defraud the Federal Aviation Administration and provided restitution to the families of the 346 people killed in the two crashes.
After the second crash in early 2019, the Max was banned globally for almost two years. The plane resumed flying at the end of 2020 after Boeing made changes to the plane, including to MCAS, the flight control system behind the crashes. The Max has flown millions of passengers since then.
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