Boeing (BA) is set to plead guilty in the Boeing DOJ case for criminal fraud conspiracy. This Justice Department agreement labels Boeing a corporate felon but aims to resolve significant legal issues.
The charge and plea deal, detailed by US prosecutors on Sunday, concern Boeing’s actions.
#BoeingDOJcase They involve misleading FAA regulators before two fatal 737 MAX crashes in the late 2010s.
Boeing will have to pay fines of up to $487.2 million, although a judge will rule on the final amount. The Justice Department asked that Boeing be credited for fines already paid, which means the new amount could be $243.6 million.
The company will operate under a corporate monitor for three years. Additionally, it will invest $455 million in compliance and safety improvements. #BoeingDOJcase
“We can confirm that we have reached an agreement in principle on terms of a resolution with the Justice Department, subject to the memorialization and approval of specific terms,” Boeing said in a statement.
Boeing stock was up 3% in Monday morning trading.
The deal presents Boeing with plenty of new perils.
A plea deal could get rejected by a judge. Families of the victims of the two crashes last decade have vowed to oppose the pact. And perhaps the biggest danger is the effect that a conviction may have on Boeing’s already-battered bottom line. #BoeingDOJcase
Criminal convictions can foreclose or suspend a company’s right to contract with the federal government and frustrate its ability to secure loans, according to Eddie Jauregui, a former federal prosecutor and white-collar defense attorney with Holland & Knight.
Boeing DOJ case repercussions extend beyond legal fines to include reputational damage and regulatory scrutiny.
