Boeing Pays $200-M For Misleading Public On Safety Of 737 Max Jets
Boeing and its former CEO Dennis Muilenburg agreed to pay hefty fines to settle charges from the Securities and Exchange Commission (SEC) that they misled the public about the safety of the 737 Max following two fatal crashes in 2018 and 2019, David Goldman reported for CNN Business.
Photo Insert: Lion Air Flight 610 was a scheduled domestic flight from Soekarno–Hatta International Airport, Jakarta to Depati Amir Airport, Pangkal Pinang, Indonesia - a Boeing 737 Max that crashed shortly after takeoff, all 189 passengers and crew killed.
The SEC alleges that, following an October 2018 crash of a Lion Air 737 Max jet that killed 189 people, Boeing and Muilenburg knew that part of the plane's flight control system posed an ongoing safety concern yet told the public that the 737 Max was safe to fly.
After a March 10, 2019, fatal 737 Max crash, the SEC alleges that Boeing and Muilenburg knowingly misled the public about "slips" and "gaps" in the certification process of that flight control system.
"In times of crisis and tragedy, it is especially important that public companies and executives provide full, fair, and truthful disclosures to the markets," said SEC Chair Gary Gensler in a statement.
"The Boeing Company and its former CEO, Dennis Muilenburg, failed in this most basic obligation. They misled investors by providing assurances about the safety of the 737 MAX, despite knowing about serious safety concerns."
In a statement, Boeing said that the settlement "fully resolves” the SEC's previously disclosed inquiry into matters relating to the 737 MAX accidents.
"Today's settlement is part of the company's broader effort to responsibly resolve outstanding legal matters related to the 737 MAX accidents in a manner that serves the best interests of our shareholders, employees, and other stakeholders," Boeing said.