Boeing has agreed to pay over 25B on its deferred prosecution agreement

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Phil LeBeau reports Boeing has agreed to pay $2.5 billion dollars after the DOJ charged the company with a conspiracy to defraud the United States for misleading regulators while seeking approval for its 737 Max fraud conspiracy. He joins 'Closing Bell' to discuss. For access to live and exclusive video from CNBC subscribe to CNBC PRO: https://cnb.cx/2NGeIvi • Boeing agreed to pay more than $2.5 billion to settle criminal charges with the U.S. Justice Department, which accused the company of concealing information about its 737 Max airplane that was involved in two crashes that claimed 346 lives, federal prosecutors announced Thursday. • Prosecutors said Boeing “knowingly and willfully” conspired to defraud the United States by undermining the Federal Aviation Administration’s ability to evaluate the safety of the plane. • The FAA wasn’t “fully informed” about the capabilities of a flight-control system on the planes, a software that was later implicated in the two crashes, according to a deferred prosecution agreement that closes the DOJ’s nearly two-year probe and drops all charges after three years if there aren’t additional violations. • “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 of the Justice Department’s Criminal Division, wrote in a 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 crashes plunged Boeing into its worst-ever crisis, sparking a worldwide grounding of its best-selling plane, numerous investigations and hurting the reputation of one what was the world’s biggest aircraft manufacturer. • Last month, the FAA approved software and other safety changes Boeing made to the planes, clearing airlines to start flying them again. • The company admitted to the wrongdoing and waived its rights to a trial as part of its deal with DOJ to settle the charges. The agreement also didn’t implicate top executives there, saying the misconduct wasn’t pervasive nor were senior managers involved. • “This is a substantial settlement of a very serious matter, and I firmly believe that entering into this resolution is the right thing for us to do — a step that appropriately acknowledges how we fell short of our values and expectations,” CEO Dave Calhoun said in a note to Boeing employees. • Boeing will take a $743.6 million charge to its fourth-quarter 2020 results for the fine and said $1.77 billion has “been included in amounts reserved in prior quarters for 737 MAX customer considerations.” • Boeing shares were down about 1% in afterhours trading after the news broke. • » Subscribe to CNBC TV: https://cnb.cx/SubscribeCNBCtelevision • » Subscribe to CNBC: https://cnb.cx/SubscribeCNBC • » Subscribe to CNBC Classic: https://cnb.cx/SubscribeCNBCclassic • Turn to CNBC TV for the latest stock market news and analysis. From market futures to live price updates CNBC is the leader in business news worldwide. • The News with Shepard Smith is CNBC’s daily news podcast providing deep, non-partisan coverage and perspective on the day’s most important stories. Available to listen by 8:30pm ET / 5:30pm PT daily beginning September 30: https://www.cnbc.com/2020/09/29/the-n... • • Connect with CNBC News Online • Get the latest news: http://www.cnbc.com/ • Follow CNBC on LinkedIn: https://cnb.cx/LinkedInCNBC • Follow CNBC News on Facebook: https://cnb.cx/LikeCNBC • Follow CNBC News on Twitter: https://cnb.cx/FollowCNBC • Follow CNBC News on Instagram: https://cnb.cx/InstagramCNBC • https://www.cnbc.com/select/best-cred... • #CNBC • #CNBCTV

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