Federal prosecutors recommend to Justice Department that Boeing be criminally prosecuted

Federal prosecutors have recommended to top Justice Department officials that airline manufacturer Boeing be criminally prosecuted, CBS News has learned.

Although the recommendation to senior Justice Department officials is not a final decision, it is the latest development in ongoing exchanges regarding Boeing’s allegations. violation of a 2021 deferred prosecution agreement. The exact nature of the newly recommended charges was not immediately clear.

News of the recommended charges was first reported by Reuters.

The Justice Department found earlier this year that Boeing violated the deferred prosecution agreement and indicated in court filings that it may bring charges against the company for conduct related to two fatal 737 Max crashes in 2018 and 2019 and beyond.

The Department of Justice has until July 7 to inform the Federal Court of its plans.

The Justice Department and Boeing declined to comment.

The agreement called for Boeing to pay a $2.5 billion settlement and make certain organizational changes in exchange for the Justice Department dropping fraud conspiracy charges after a three-year period. That three-year period would have ended in July, at which point the Justice Department would have closed the case against Boeing if it had been determined that the company had complied with its terms of the agreement.

But in May, federal prosecutors wrote that Boeing “failed in its obligations” and allegedly failed to “design, implement and enforce a compliance and ethics program to prevent and detect violations of U.S. safety laws.” fraud throughout its operations.”

Boeing answered in Junetelling the Department of Justice that he had followed the terms of the agreement and that he disagreed that he had violated the agreement.

Although the agreement was reached following the two 737 Max crashes, which left a total of 346 dead, Boeing has since encountered other problems with its planes. In January this year, the cabin door of an Alaska Airlines plane exploded in mid-flight. In March, a person familiar with the matter confirmed to CBS News that prosecutors were investigating whether the eruption could affect the deferred prosecution agreement.

A June whistleblower report has raised concerns that Boeing was using faulty parts in building its planes.

The report from Boeing employee Sam Mohawk claims there was a “300% increase” in reports of parts that did not meet the manufacturer’s standards when production of the 737 Max resumed. These parts were supposed to be removed from production, but the report alleges that “the 737 program was losing hundreds of non-conforming parts” and “Mohawk was concerned that non-conforming parts were being installed on the 737s and that this could lead to a catastrophic event »

Another whistleblower, former quality manager Santiago Paredes, raised concerns about Spirit AeroSystems, the Boeing supplier that builds most of the 737 Max jets. Paredes told CBS News he came under pressure to downplay problems he had discovered while inspecting the plane’s fuselages. He said in public comments that he often encountered problems inspecting the part of the plane that suffered the mid-flight explosion in January.

Boeing CEO David Calhoun faced Senate hearing last weekduring which he said the company was “far from perfect” but said it was “committed to making sure every employee feels empowered to speak up if there is a problem.”

—Kris Van Cleave and Kathryn Krupnik contributed reporting.