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Boeing hit with $3.2 billion fine after deceiving authorities about fatal flaw

Published: (Updated: ) in Australian News by .

Plane manufacturer Boeing has agreed to pay a A$3.2 billion fine over fraud charges related to two devastating jumbo jet crashes.

Plane manufacturer Boeing has agreed to pay a A$3.2 billion fine over fraud charges related to two devastating jumbo jet crashes.

The massive multinational corporation was charged with conspiracy to defraud the United States over making misleading statements to authorities about the safety of its 737 MAX aeroplane.

More than half the payment will go to compensate airlines which have bought the 737 MAX.

Another A$643 million (US$500 million) will go to the heirs, relatives and legal beneficiaries of the 346 passengers who died in the Lion Air Flight 610 and Ethiopian Airlines Flight 302 crashes.

"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," Acting Assistant Attorney General David P Burns said in a statement released by the US Justice Department.

"Boeing's employees chose the path of profit over candour 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.

"This resolution holds Boeing accountable for its employees' criminal misconduct, addresses the financial impact to Boeing's airline customers, and hopefully provides some measure of compensation to the crash-victims' families and beneficiaries."

Nearly 200 passengers and crew were killed when the Lion Air 737 crashed just after takeoff from Jakarta, Indonesia, in October 2018.

All but one of the victims were Indonesian.

The crash was blamed on a design flaw of the 737.

In March the following year, 157 passengers and crew died six minutes after takeoff in Addis Abeba, Ethiopia.

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Every 737 MAX aeroplane worldwide was grounded following the second crash.

Boeing deceived US authorities about an important aircraft component called the Manoeuvring Characteristics Augmentation System (MCAS).

Boeing technical pilots became aware of changes to the system in 2016, but kept it from authorities. The changes were omitted from plane manuals and pilot training materials.

"The misleading statements, half-truths, and omissions communicated by Boeing employees to the FAA impeded the government's ability to ensure the safety of the flying public," US Attorney Erin Nealy Cox said in a statement.

"This case sends a clear message: The Department of Justice will hold manufacturers like Boeing accountable for defrauding regulators – especially in industries where the stakes are this high."

Boeing had told airlines there was a critical warning light which would alert pilots if the MCAS was being fed false data.

But it discovered months before the crash the light would not operate unless the airlines purchased a separate feature.

The settlement was announced moments after trading closed on the New York Stock Exchange.

Source: 9News https://www.9news.com.au/world/boeing-billion-dollar-fine-737-safety-feature-ethiopia-plane-crash-lion-air-indonesia/0f773fb5-f0f9-43ad-9aa6-09d76d7e02cc

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