Boeing agrees to pay $2.5 billion to settle federal charges that it tried to defraud the FAA during its 737 Max scandal

Boeing agrees to pay $2.5 billion to settle federal charges that it tried to defraud the FAA during its 737 Max scandal
A Boeing 737 Max 7.Andreas Zeitler/
  • Boeing will pay a $2.5 billion fine to settle fraud conspiracy charges, federal prosecutors said Thursday.
  • Company employees were misleading or outright lied to safety regulators during the recertification process for the 737 Max jet, the Department of Justice said.
  • The 737 Max returned to the skies last month following two deadly crashes and a nearly two-year grounding.
  • Shares of Boeing fell slightly in late trading after the settlement was announced.

Boeing has agreed to pay a $2.5 billion criminal penalty to settle charges of fraud conspiracy related to its 737 Max scandal, federal officials said Thursday.

The airplane maker attempted to defraud the Federal Aviation Administration through misleading statements and "half-truths" as it worked with regulators to rectify issues with the plane, which was grounded after two deadly crashes, the Department of Justice said.

"The tragic crashes of Lion Air Flight 610 and Ethiopian Airlines Flight 302 exposed fraudulent and deceptive conduct by employees of one of the world's leading commercial airplane manufacturers," David P. Burns, acting assistant attorney general in the DOJ's criminal division, said in a press release. "Boeing's employees chose the path of profit over candor by concealing material information from the FAA concerning the operation of its 737 Max airplane and engaging in an effort to cover up their deception."

The two employees responsible are no longer with the company, Boeing said. They have not been identified.

The 737 Max returned to the skies this month after the FAA approved it to once again carry passengers following the two crashes and a 20-month grounding. The crisis led to Boeing firing former CEO Dennis Muilenburg, scores of layoffs, and intensive software changes to the jet.


Shares of Boeing fell about 1% in late trading Thursday following the announcement of the settlement.

"I firmly believe that entering into this resolution is the right thing for us to do - a steep that appropriately acknowledges how we fell short of our values and expectations," CEO David Calhoun said in a press release. "This resolution is a serious reminder to all of us hw critical our obligation of transparency to regulators is, and the consequences that our company can face if any of us falls short of those expectations."

The penalty payment from Boeing also includes compensation for airlines and families of the crash victims.