Thursday, October 6, 2022

Boeing fined $200 million for misleading investors on 737 MAX safety

Boeing has been fined $200 million for misleading investors investors on the safety of 737 MAX as confirmed by the US Securities and Exchange Commission (SEC) on Thursday.

According to SEC both the company and former CEO Dennis A. Muilenburg made false statements to investors even after the airplane crashed in 2018 and 2019.

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Muilenburg is further accused of knowing very well the safety challenges facing the airplane but went ahead and assured investors that it was the safest to ever fly the skies. Even after the second crash, the former CEO continued to assure investors that the airplane was safe.

“In times of crisis and tragedy, it is especially important that public companies and executives provide full, fair, and truthful disclosures to the markets.” Said SEC chair Gary Gensler.

In October 2018 Lion Air Flight 610 was the first airplane to crash and followed by another 737 MAX model of the Ethiopian Airlines Flight 302 back in 2019 immediately after it took off killing all passengers on board.

The second crash saw he US Federal Aviation Administration (FAA) ground the airplanes for 20 months a period under which Boeing was sued for damages caused by financial losses.

In November 2020, they were cleared and the American company ordered to revise their 737 MAX pilot program pending further upgrade of the technology used on the airplane.

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