Boeing Co BA.N will pay $200 million by the United States Securities and Exchange Commission (SEC) to settle allegations that it misled investors about the 737 MAX plane, which was grounded for 20 months after two fatal crashes. in which there were 346 deaths, the agency said on Thursday.
The SEC also said that former Boeing CEO Dennis Muilenberg agreed to pay $1 million.
“In times of crisis and tragedy, it is particularly important that publicly traded companies and officials provide markets with complete, fair and truthful information,” SEC Chairman Gary Gensler said in a statement.
The head of the regulator said that Boeing and Muilenburg “did not respond to this basic obligation.”
The SEC said Boeing and Muilenburg neither accepted nor denied the SEC’s findings. The regulatory agency said a fund would be set up for the benefit of the injured investors.
The SEC accused both Boeing and Muilenburg of “making materially misleading public statements following the Boeing plane crashes in 2018 and 2019.”
Boeing confirmed the agreement and said it does not admit or deny wrongdoing.
The company said it has made “fundamental changes that have strengthened our safety procedures” and said “the settlement is part of a larger initiative to responsibly address outstanding legal issues related to 737 MAX accidents.”
The accidents were linked to a flight control system called the Maneuver Characteristic Enhancement System (MCAS). The SEC stated that “after the first crash, Boeing and Muilenburg were aware that MCAS faced an ongoing aircraft safety problem, but still assured the public that the 737 MAX is ‘as safe as any aircraft that can fly’.” Sometimes flies in the sky.”
After the second crash, the SEC said, “Boeing and Muilenburg assured the public that there were no flaws or flaws in the certification process with respect to the MCAS, notwithstanding learning to the contrary.”
In January 2021, Boeing agreed to pay $2.5 billion in fines and damages to settle the US Justice Department’s criminal investigation into the 737 MAX crashes.
The Justice Department settlement, which allowed Boeing to avoid prosecution, included a $243.6 million fine, $1.77 billion in compensation to airlines, and a $500 million fund for crash victims.