According to a document submitted to the court on Wednesday, the Boeing Company (BA.US) has finally pleaded guilty to one count of criminal conspiracy to commit fraud and has agreed to pay at least 0.2436 billion USD after violating an agreement reached with the US Department of Justice in 2021.

The US Justice Department has stated why it believes Boeing violated the 2021 deferred prosecution agreement, stating that Boeing allowed its factories to engage in potentially risky work and did not ensure that key aircraft records were kept accurate or complete.

On July 7th, Boeing Company tentatively agreed to plead guilty to colluding in deceiving the Federal Aviation Administration (FAA) of the United States. Previously, the US government had stated that Boeing intentionally made false statements about key software for the 737 MAX.

Boeing Company confirmed on Wednesday that it has submitted a detailed plea agreement to the Justice Department. The company stated: "We will continue to work transparently with regulatory agencies throughout the entire Boeing company to take significant actions to further strengthen our safety, quality and compliance programs."

The US Justice Department said in May of this year that Boeing violated obligations in the agreement that protected the aircraft manufacturer from criminal prosecution related to false statements about a key software feature in the 2018 and 2019 737 MAX fatal crashes that killed 346 people.

In January of this year, the flight panel on a 737 MAX aircraft belonging to Alaska Airlines (ALK.US) burst, exposing ongoing safety and quality issues at Boeing, and just two days later, the 2021 agreement expired, which had protected Boeing from prosecution related to the prior fatal crashes.

Document incomplete

The US Justice Department said in documents submitted to the court that Boeing failed to ensure that employees recorded the disassembly of aircraft parts during the manufacturing process, and did not ensure that mechanics and inspectors who stamped that work was completed had actually completed the work.

The US Justice Department stated that in April of this year, Boeing disclosed that some employees at its 787 plant in South Carolina had falsified stamped parts. In May of this year, Boeing stated that some employees at the factory claimed to have completed some testing, with "improper activities" present, and the Federal Aviation Administration of the United States stated that it was investigating the matter. The US Justice Department said that Boeing also failed to ensure that work on the aircraft was carried out in the correct order.

The document stated: "Boeing executives prioritized the flow of planes through Boeing's factories over reducing disorganized work to ensure product quality." "Disorganized work is harder to complete and increases the risk of defects in the manufacturing process."

The Justice Department is conducting a separate criminal investigation into Alaska Airlines' aircraft, which lost four key bolts. Boeing said that detailed documents on the disassembly of the bolts have not been completed.

As part of the plea agreement, Boeing has agreed to pay a maximum fine of 0.4872 billion USD, with the US Justice Department recommending that the 0.2436 billion USD paid in 2021 be credited.

The document stated that Boeing has also agreed to spend at least 0.455 billion USD in the next three years to strengthen safety and compliance projects, which is 75% higher than Boeing's previous planned spending on corporate compliance projects.

Families of the MAX crash victims will be able to object to Judge Reed O'Connor's acceptance of the agreement within one week, and he will decide whether Boeing owes compensation to the families of the victims.

The document also states that the Boeing board of directors must meet with the families of the victims within four months after the judgment.

The agreement also establishes an independent supervisory body that must submit annual progress reports publicly to monitor the company's compliance. Boeing will be under review for the term of the supervisor's three-year term, which may be extended by one year if Boeing fails to comply with these terms.