Boeing has agreed to plead guilty to a criminal fraud conspiracy charge after the US found the company violated a deal meant to reform it after two fatal crashes by its 737 Max planes that killed 346 passengers and crew.

Settlement Sparks Outrage from Victims’ Families

The Department of Justice (DoJ) said the plane-maker had also agreed to pay a criminal fine of $243.6 million (£190 million). However, the families of the people who died on the flights five years ago have criticized it as a “sweetheart deal” that would allow Boeing to avoid full responsibility for the deaths. One called it an “atrocious abomination.”

Avoiding a Criminal Trial

The settlement must now be approved by a US judge. By pleading guilty, Boeing will avoid the spectacle of a criminal trial—something that victims’ families have been pressing for. The company has been in crisis over its safety record since two near-identical crashes involving 737 Max aircraft in 2018 and 2019. It led to the global grounding of the plane for more than a year.

Allegations of Deception

In 2021, prosecutors charged Boeing with one count of conspiracy to defraud regulators, alleging it had deceived the Federal Aviation Administration (FAA) about its MCAS flight control system, which was implicated in both crashes. It agreed not to prosecute Boeing if the company paid a penalty and successfully completed a three-year period of increased monitoring and reporting.

Renewed Scrutiny After Incident

But in January, shortly before that period was due to end, a door panel in a Boeing plane operated by Alaska Airlines blew out soon after take-off and forced the jet to land. No one was injured during the incident, but it intensified scrutiny over how much progress Boeing had made on improving its safety and quality record.

DOJ’s Findings

In May, the DoJ said it had found Boeing had violated the terms of the agreement, opening up the possibility of prosecution. Boeing’s decision to plead guilty is still a significant black mark for the firm because it means that the company—which is a prominent military contractor for the US government—now has a criminal record. It is also one of the world’s two biggest manufacturers of commercial jets.

Potential Impact on Contracting Business

It is not immediately clear how the criminal record will affect the firm’s contracting business. The government typically bars or suspends firms with records from participating in bids but can grant waivers.

Criticism from Legal and Safety Advocates

Paul Cassell, a lawyer representing some families of people killed on the 2018 and 2019 flights, said, “This sweetheart deal fails to recognize that because of Boeing’s conspiracy, 346 people died.” In a letter to the government in June, Mr. Cassell had urged the DoJ to fine Boeing more than $24 billion. Zipporah Kuria, who lost her father Joseph in one of the fatal crashes, said the plea was an “atrocious abomination.”

A Call for Accountability

“Miscarriage of justice is a gross understatement in describing this,” she said. “I hope that, God forbid, if this happens again, the DoJ is reminded that it had the opportunity to do something meaningful and instead chose not to.” Ed Pierson, executive director of Foundation for Aviation Safety and a former senior manager at Boeing, said the plea was “seriously disappointing” and “a terrible deal for justice.”

Background of the Crashes

A Boeing 737 Max plane operated by Indonesia’s Lion Air crashed in late October 2018 shortly after take-off, killing all 189 people on board. Just months later, an Ethiopian Airlines plane crashed, killing all 157 passengers and crew. In the 2021 deal, Boeing also agreed to pay $2.5 billion to resolve the matter, including a $243 million criminal penalty and $500 million to a victims’ fund. The deal outraged family members, who were not consulted on the terms and have called for the company to stand trial.

Ongoing Investigations and Lawsuits

Mark Forkner, a former Boeing technical pilot who was the only person to face criminal charges arising from the incident, was acquitted by a jury in 2022. His lawyers had argued he was being used as a scapegoat. The issues with MCAS were not Boeing’s first brush with the law. It has also paid millions in penalties to the Federal Aviation Administration since 2015 to resolve a series of claims of improper manufacturing and other issues. The company also continues to face investigations and lawsuits sparked by the incident on the January Alaska Airlines flight.