SEC accuses Boeing of misleading MAX claims

The Securities and Exchange Commission (SEC) of the United States has accused the aircraft manufacturer Boeing of providing investors with misleading information about the safety problems of the 737 MAX aircraft.

According to an SEC filing on September 22, 2022, Boeing and its former chief executive Dennis Muilenburg agreed to pay $200 million and $1 million, respectively, to settle the case.

The SEC’s investigation found that Muhlenburg and the manufacturer made false public statements about the 737 MAX and its flight stabilization system, the maneuverability augmentation system (MCAS), the failure of which led to two fatal MAX crashes in Indonesia and Ethiopia in 2018 and 2019. .

According to the SEC, Boeing and Muilenburg were aware of the safety issues with the MCAS system but assured the public that the plane was completely safe to operate.

SEC statement reads: “Boeing and Muilenburg knew that MCAS posed an ongoing airplane safety problem, but still assured the public that the 737 MAX was as safe as any airplane that had ever flown the sky. Later, after the second crash, Boeing and Muilenburg assured the public that there were no errors or gaps in the certification process regarding MCAS, despite knowing information to the contrary.”

The SEC alleged that a month after the crash of Lion Air Flight 610 in 2018, the manufacturer issued a press release redacted by the CEO, in which it chose to highlight only parts of an official report by the Indonesian government, suggesting that pilot error and poor maintenance contributed to the plane accidents.

Boeing’s release also failed to say that an internal safety review had found MCAS to pose a safety hazard to the aircraft and that the manufacturer had already begun to overhaul the system.

“In times of crisis and tragedy, it is especially important that public companies and executives provide complete, fair and true information to the markets. Boeing and its former CEO, Dennis Muilenburg, failed in this most basic obligation,” said SEC Commissioner Gary Gensler.

“They misled investors by giving assurances about the safety of the 737 MAX despite knowing there were serious safety issues,” Gensler added.

https://www.aerotime.aero/articles/32234-boeing-pays-200-million-settle-sec-charges SEC accuses Boeing of misleading MAX claims

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