{"id":1656694,"date":"2022-09-25T06:53:30","date_gmt":"2022-09-25T10:53:30","guid":{"rendered":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1656694"},"modified":"2022-09-25T06:53:46","modified_gmt":"2022-09-25T10:53:46","slug":"boeing-to-pay-sec-200-million-fine-for-misleading-investors-on-737-max-safety-inspections","status":"publish","type":"post","link":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/boeing-to-pay-sec-200-million-fine-for-misleading-investors-on-737-max-safety-inspections\/","title":{"rendered":"Boeing to Pay SEC $200 Million Fine for Misleading Investors on 737 MAX Safety Inspections"},"content":{"rendered":"<aside class=\"mashsb-container mashsb-main mashsb-stretched\"><div class=\"mashsb-box\"><div class=\"mashsb-count mash-medium\" style=\"float:left\"><div class=\"counts mashsbcount\">30<\/div><span class=\"mashsb-sharetext\">SHARES<\/span><\/div><div class=\"mashsb-buttons\"><a class=\"mashicon-facebook mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/www.facebook.com\/sharer.php?u=https%3A%2F%2Fwww.conservativenewsdaily.net%2Fbreaking-news%2Fboeing-to-pay-sec-200-million-fine-for-misleading-investors-on-737-max-safety-inspections%2F\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Facebook<\/span><\/a><a class=\"mashicon-twitter mash-medium mash-nomargin mashsb-noshadow\" href=\"https:\/\/twitter.com\/intent\/tweet?text=&amp;url=https:\/\/www.conservativenewsdaily.net\/breaking-news\/?p=1656694&amp;via=ConservNewsDly\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Twitter<\/span><\/a><a class=\"mashicon-subscribe mash-medium mash-nomargin mashsb-noshadow\" href=\"#\" target=\"_top\" rel=\"nofollow\"><span class=\"icon\"><\/span><span class=\"text\">Subscribe<\/span><\/a><div class=\"onoffswitch2 mash-medium mashsb-noshadow\" style=\"display:none\"><\/div><\/div>\n            <\/div>\n                <div style=\"clear:both\"><\/div><\/aside>\n            <!-- Share buttons by mashshare.net - Version: 4.0.47--><p>Boeing announced that it had reached a $200 million settlement with the\u00a0<a href=\"https:\/\/www.theepochtimes.com\/t-securities-and-exchange-commission\">Securities and Exchange Commission<\/a> (SEC)\u00a0after allegations that it deceived its own investors and the public about the safety of its best-selling 737 MAX jetliner.<\/p>\n<p>The <a href=\"https:\/\/www.theepochtimes.com\/t-boeing-737\">Boeing 737<\/a> MAX killed 346 people in two separate fatal crashes,\u00a0forcing the Federal Aviation Administration (<a href=\"https:\/\/www.theepochtimes.com\/t-faa\">FAA<\/a>) to ground the airplane for 20 months and only allowing it to fly again in November 2020.<\/p>\n<p>The deadly crashes occurred in the waters off of Indonesia and in Ethiopia in late 2018 and early 2019.<\/p>\n<p>\u201cIn times of crisis and tragedy, it is especially important that public companies and executives provide full, fair, and truthful disclosures to the markets,\u201d said SEC Chairman Gary Gensler in <a href=\"https:\/\/www.sec.gov\/news\/press-release\/2022-170\">a\u00a0Sept. 22 statement.<\/a><\/p>\n<p>Boeing shares have gone down 68 percent from their record high after the second <a href=\"https:\/\/www.theepochtimes.com\/t-crash\">crash<\/a> in March 2019.<\/p>\n<p>\u201cBoeing and [former CEO Dennis] Muilenburg put profits over people by misleading investors about the safety of the 737 MAX all in an effort to rehabilitate Boeing\u2019s image following two tragic accidents that resulted in the loss of 346 lives and incalculable grief to so many families,\u201d said Gurbir S. Grewal, director of the SEC\u2019s Enforcement Division.<\/p>\n<p>The SEC alleged that after the first fatal crash of the jetliner, Muilenburg covered up the fact that a flight control function called the\u00a0Maneuvering Characteristics Augmentation System (MCAS) was an ongoing safety hazard, but continued to assure that the 737 was still airworthy.<\/p>\n<p>After the second crash, the former CEO and his colleagues at Boeing were found to have misled the public about lapses in the aircraft\u2019s certification process concerning the MCAS automated flight control system, despite the fact that there was plenty of internal information acknowledging a problem, according to the SEC.<\/p>\n<p>\u201cBoeing and Muilenburg assured the public that there were no slips or gaps in the certification process with respect to MCAS, despite being aware of contrary information,\u201d said an initial statement by the SEC in 2019.<\/p>\n<h2>Misleading Regulators and Investors<\/h2>\n<p>The SEC soon heard of an alleged internal coverup by company management and of the investigation by the FAA, after the false statements made by the former CEO and Boeing executives to investors and the agency.<\/p>\n<p>In response to the investigation, Muilenberg called the 737 MAX \u201cas safe as any airplane that has ever flown the skies,\u201d which immediately received a public rebuke from the FAA, causing strain on Boeing\u2019s relationship with the regulator and humiliating the company.<\/p>\n<p>Boeing fired its then-CEO in December 2019, after news of the inspection scandal broke and partially due to his comments regarding the 737\u2019s clearance status by air safety regulators.<\/p>\n<p>The SEC chair said that Muilenburg and Boeing \u201cfailed in this most basic obligation\u201d to be \u201cfull, fair, and truthful in disclosures to the markets\u201d and that \u201cthey misled investors by providing assurances about the safety of the 737 MAX, despite knowing about serious safety concerns.\u201d<\/p>\n<p class=\"\">Neither the former CEO nor the aerospace manufacturer have challenged the agency\u2019s findings, which accused them of putting \u201cprofits over people by misleading investors about the safety of the 737 Max all in an effort to rehabilitate Boeing\u2019s image.\u201d<\/p>\n<p>Muilenburg was forced to pay a separate $1 million in a settlement with the SEC.<\/p>\n<p>However, he will not face charges and the settlement does not require him to admit to any wrongdoing.<\/p>\n<p>\u201cToday\u2019s settlement is part of the company\u2019s broader effort to responsibly resolve outstanding legal matters related to the 737 MAX accidents in a manner that serves the best interests of our shareholders, employees, and other stakeholders,\u201d Boeing said in a statement to CNBC.<\/p>\n<h2>Settling the Scandal<\/h2>\n<p class=\"\">The airline manufacturer had previously agreed to pay $2.5 billion to settle a separate criminal probe by the Justice Department, after two congressional hearings uncovered serious lapses in the 737\u2019s manufacturing and approval process.<\/p>\n<p>As part of that\u00a0settlement, $500 million would be allocated to the families of victims who died in the two 737 crashes.<\/p>\n<p>Current and former company directors reached an additional $237.5 million settlement with\u00a0shareholders in 2021 over the board\u2019s lack of oversight of the 737.<\/p>\n<p>A few more trials are expected to be held in court in 2023 to resolve further claims.<\/p>\n<p>Congress has since passed the\u00a0<a href=\"https:\/\/www.congress.gov\/bill\/116th-congress\/house-bill\/8408\">Aircraft Certification Reform and Accountability Act<\/a> to\u00a0reform aircraft certification, giving the FAA more power to oversee the process.<\/p>\n<p>The bill\u2019s sponsor, House Aviation Subcommittee Vice-Chair Sharice Davids (D-Kans.) <a href=\"https:\/\/davids.house.gov\/media\/press-releases\/house-passes-davids-backed-legislation-improve-aircraft-safety\">said in a statement<\/a>, \u201cThe 346 victims of the Boeing 737 MAX crashes and their families expect and deserve Congress to act to make sure the mistakes that led to those tragedies never happen again.\u201d<\/p>\n<p>\u201cThis bipartisan bill will strengthen aviation safety and accountability and help pilots and flight crews do their jobs safely and efficiently. I was glad to see my House colleagues come together today to pass this critical legislation, and I urge the Senate to do the same,\u201d she added in the Nov. 18, 2020, statement.<\/p>\n<p>American, United, Southwest, and Alaska Airlines are the only U.S. carriers that fly the 737 MAX, while Delta, which ordered 100 of the 737 MAX 10 model of the plane, has yet to receive delivery.<\/p>\n<p>Boeing shares fell about 7.45 percent at the end of the week\u2019s trading.<\/p>\n<div class=\"author_wrapper\">\n<div class=\"one_author_block round\">\n<div class=\"top_row\">\n\t\t\t\t\t<a href=\"https:\/\/www.theepochtimes.com\/author-bryan-jung\"><\/a><\/p>\n<p>Follow<\/p>\n<\/div>\n<p>Bryan S. Jung is a native and resident of New York City with a background in politics and the legal industry. He graduated from Binghamton University.\n<\/p>\n<\/p><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Boeing announced that it had reached a $200 million settlement with the\u00a0Securities and Exchange Commission (SEC)\u00a0after allegations that it deceived its own investors and the public about the safety of<\/p>\n","protected":false},"author":1,"featured_media":2315279,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_mo_disable_npp":"","fifu_image_url":"","fifu_image_alt":"","footnotes":""},"categories":[],"tags":[],"class_list":["post-1656694","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry"],"_links":{"self":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1656694","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/comments?post=1656694"}],"version-history":[{"count":0,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/posts\/1656694\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media\/2315279"}],"wp:attachment":[{"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/media?parent=1656694"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/categories?post=1656694"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.conservativenewsdaily.net\/breaking-news\/wp-json\/wp\/v2\/tags?post=1656694"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}