One of the world’s largest aerospace companies could be branded a felon pretty soon.
What happened: Boeing will plead guilty to a criminal fraud charge in the U.S. for deceiving regulators about its flight software that caused two deadly plane crashes in 2018 and 2019. The company will have to pay a US$243.6 million fine as part of the settlement.
- Boeing had avoided a guilty plea when it signed a more lenient deal in 2021 to avoid prosecution, but because of compliance failures, that deal has now been voided.
- With the original deal out the window, Boeing was left with two choices: Face a criminal trial, or plead guilty and pay a fine. It landed on the latter.
Why it matters: The guilty plea falls well short of what some families of the plane crash victims have been advocating for. Families had pushed for a fine as high as US$25 billion and criminal charges against Boeing executives, not just the company.
- Lawyers representing some of the families are now petitioning the judge on the case to reject the plea agreement and move forward with a criminal trial.
Big picture: Companies with criminal convictions can be banned or suspended as defence contractors in the U.S. and Canada. The guilty plea could put Ottawa’s CA$10 billion order for 16 of Boeing’s P-8A Poseidon aircraft in jeopardy.—LA