US plane maker Boeing will pay $200 million to settle charges by the US Securities and Exchange Commission (SEC) that it misled investors by not disclosing safety issues of its 737 Max jetliners following two fatal crashes of the aircraft, which killed 346 people.
Boeing and its former chief executive Dennis Muilenburg made “materially misleading public statements” following crashes of the Boeing aircraft in 2018 and 2019, the SEC said on Thursday.
The crashes involving the Boeing 737 Max jets were blamed largely on failures of the flight control function called the Manoeuvring Characteristics Augmentation System (MCAS).
“In times of crisis and tragedy, it is especially important that public companies and executives provide full, fair and truthful disclosures to the markets,” SEC chairman Gary Gensler said.
“Boeing and its former chief executive Dennis Muilenburg failed in this most basic obligation. They misled investors by providing assurances about the safety of the 737 Max, despite knowing about serious safety concerns.”
The 737 Max was grounded in 2019 after two crashes that killed 346 people in Indonesia and Ethiopia in 2018 and 2019, respectively.
In January 2021, the Chicago-based aircraft manufacturer paid more than $2.5 billion in fines and compensation after reaching a settlement with the US Department of Justice over the two plane crashes.
The settlement, which allowed Boeing to avoid prosecution, included a fine of $243.6m, compensation to airlines of $1.77bn and a $500m crash-victim fund over fraud conspiracy charges related to the plane’s flawed design.
The 737 Max was grounded in March 2019, and the grounding was not lifted until November 2020, after Boeing made significant safety upgrades and improvements in pilot training.
In times of crisis and tragedy, it is especially important that public companies and executives provide full, fair and truthful disclosures to the markets
Gary Gensler,
chair of US Securities and Exchange Commission
After the first crash, Boeing and Mr Muilenburg knew that MCAS posed an ongoing aircraft safety issue, but assured the public that the 737 Max aircraft was “as safe as any airplane that has ever flown the skies”, according to the SEC statement.
One month after Lion Air Flight 610, a 737 Max jet, crashed in Indonesia in October 2018, Boeing issued a press release, edited and approved by Mr Muilenburg, that selectively highlighted certain facts from an official report of the Indonesian government suggesting that pilot error and poor aircraft maintenance contributed to the crash, according to the SEC.
That press release also gave assurances of the plane’s safety and failed to disclose that an internal safety review had determined that MCAS posed an ongoing “airplane safety issue” and that Boeing had already begun redesigning MCAS to address faults with it, the US markets regulator said.
“The SEC remains committed to rooting out misconduct when public companies and their executives fail to fulfil their fundamental obligations to the investing public,” Mr Gensler said.
About six weeks after the March 2019 crash of Ethiopian Airlines Flight 302, another 737 Max, Mr Muilenburg, though aware of information calling into question certain aspects of the certification process relating to MCAS, told analysts and reporters that “there was no surprise or gap … that somehow slipped through [the] certification process” for the 737 Max, the SEC statement said.
He also said that Boeing had “gone back and confirmed again … that we followed exactly the steps in our design and certification processes that consistently produce safe airplanes”, the SEC statement said.
The SEC’s orders against Boeing and Mr Muilenburg said they negligently breached the antifraud provisions of federal securities laws.
Without admitting or denying the SEC’s findings, Boeing and Mr Muilenburg consented to cease-and-desist orders that include penalties of $200m and $1m, respectively. A Fair Fund will be established for the benefit of harmed investors.
“Boeing and Muilenburg put profits over people by misleading investors about the safety of the 737 Max all in an effort to rehabilitate Boeing’s image,” said Gurbir Grewal, director of the SEC’s enforcement division.
“But public companies and their executives must provide accurate and complete information when they make disclosures to investors, no matter the circumstances. When they don’t, we will hold them accountable.”
GIANT REVIEW
Starring: Amir El-Masry, Pierce Brosnan
Director: Athale
Rating: 4/5
Specs
%3Cp%3E%3Cstrong%3EEngine%3A%3C%2Fstrong%3E%201.5-litre%20turbo%204-cylinder%20%2F%202.0%20turbo%204-cylinder%20(S3)%0D%3Cbr%3E%3Cstrong%3EPower%3A%3C%2Fstrong%3E%20148bhp%20%2F%20328bhp%20(S3)%0D%3Cbr%3E%3Cstrong%3ETorque%3A%3C%2Fstrong%3E%20250Nm%20%2F%20420Nm%20(S3)%0D%3Cbr%3E%3Cstrong%3EOn%20sale%3A%3C%2Fstrong%3E%20December%0D%3Cbr%3E%3Cstrong%3EPrice%3A%3C%2Fstrong%3E%20TBA%0D%3C%2Fp%3E%0A
Women%E2%80%99s%20T20%20World%20Cup%20Qualifier
%3Cp%3EFrom%20September%2018-25%2C%20Abu%20Dhabi%0D.%20The%20two%20finalists%20advance%20to%20the%20main%20event%20in%20South%20Africa%20in%20February%202023%0D%3Cbr%3E%20%0D%3Cbr%3EGroup%20A%3A%20United%20States%2C%20Ireland%2C%20Scotland%2C%20Bangladesh%0D%3Cbr%3EGroup%20B%3A%20UAE%2C%20Thailand%2C%20Zimbabwe%2C%20Papua%20New%20Guinea%0D%3Cbr%3E%20%0D%3Cbr%3EUAE%20group%20fixtures%3A%0D%3Cbr%3ESept%2018%2C%203pm%2C%20Zayed%20Cricket%20Stadium%20%E2%80%93%20UAE%20v%20Thailand%0D%3Cbr%3ESept%2019%2C%203pm%2C%20Tolerance%20Oval%20-%20PNG%20v%20UAE%0D%3Cbr%3ESept%2021%2C%207pm%2C%20Tolerance%20Oval%20%E2%80%93%20UAE%20v%20Zimbabwe%0D%3Cbr%3E%20%0D%3Cbr%3EUAE%20squad%3A%20Chaya%20Mughal%20(captain)%2C%20Esha%20Oza%2C%20Kavisha%20Kumari%2C%20Rinitha%20Rajith%2C%20Rithika%20Rajith%2C%20Khushi%20Sharma%2C%20Theertha%20Satish%2C%20Lavanya%20Keny%2C%20Priyanjali%20Jain%2C%20Suraksha%20Kotte%2C%20Natasha%20Cherriath%2C%20Indhuja%20Nandakumar%2C%20Vaishnave%20Mahesh%2C%20Siya%20Gokhale%2C%20Samaira%20Dharnidharka%0D%3C%2Fp%3E%0A
Killing of Qassem Suleimani
More about Middle East geopolitics
Company profile
Company name: Dharma
Date started: 2018
Founders: Charaf El Mansouri, Nisma Benani, Leah Howe
Based: Abu Dhabi
Sector: TravelTech
Funding stage: Pre-series A
Investors: Convivialite Ventures, BY Partners, Shorooq Partners, L& Ventures, Flat6Labs
AndhaDhun
Director: Sriram Raghavan
Producer: Matchbox Pictures, Viacom18
Cast: Ayushmann Khurrana, Tabu, Radhika Apte, Anil Dhawan
Rating: 3.5/5
Top 5 concerns globally:
1. Unemployment
2. Spread of infectious diseases
3. Fiscal crises
4. Cyber attacks
5. Profound social instability
Top 5 concerns in the Mena region
1. Energy price shock
2. Fiscal crises
3. Spread of infectious diseases
4. Unmanageable inflation
5. Cyber attacks
Source: World Economic Foundation
Where to donate in the UAE
The Emirates Charity Portal
You can donate to several registered charities through a “donation catalogue”. The use of the donation is quite specific, such as buying a fan for a poor family in Niger for Dh130.
The General Authority of Islamic Affairs & Endowments
The site has an e-donation service accepting debit card, credit card or e-Dirham, an electronic payment tool developed by the Ministry of Finance and First Abu Dhabi Bank.
Al Noor Special Needs Centre
You can donate online or order Smiles n’ Stuff products handcrafted by Al Noor students. The centre publishes a wish list of extras needed, starting at Dh500.
Beit Al Khair Society
Beit Al Khair Society has the motto “From – and to – the UAE,” with donations going towards the neediest in the country. Its website has a list of physical donation sites, but people can also contribute money by SMS, bank transfer and through the hotline 800-22554.
Dar Al Ber Society
Dar Al Ber Society, which has charity projects in 39 countries, accept cash payments, money transfers or SMS donations. Its donation hotline is 800-79.
Dubai Cares
Dubai Cares provides several options for individuals and companies to donate, including online, through banks, at retail outlets, via phone and by purchasing Dubai Cares branded merchandise. It is currently running a campaign called Bookings 2030, which allows people to help change the future of six underprivileged children and young people.
Emirates Airline Foundation
Those who travel on Emirates have undoubtedly seen the little donation envelopes in the seat pockets. But the foundation also accepts donations online and in the form of Skywards Miles. Donated miles are used to sponsor travel for doctors, surgeons, engineers and other professionals volunteering on humanitarian missions around the world.
Emirates Red Crescent
On the Emirates Red Crescent website you can choose between 35 different purposes for your donation, such as providing food for fasters, supporting debtors and contributing to a refugee women fund. It also has a list of bank accounts for each donation type.
Gulf for Good
Gulf for Good raises funds for partner charity projects through challenges, like climbing Kilimanjaro and cycling through Thailand. This year’s projects are in partnership with Street Child Nepal, Larchfield Kids, the Foundation for African Empowerment and SOS Children's Villages. Since 2001, the organisation has raised more than $3.5 million (Dh12.8m) in support of over 50 children’s charities.
Noor Dubai Foundation
Sheikh Mohammed bin Rashid Al Maktoum launched the Noor Dubai Foundation a decade ago with the aim of eliminating all forms of preventable blindness globally. You can donate Dh50 to support mobile eye camps by texting the word “Noor” to 4565 (Etisalat) or 4849 (du).
Greatest of All Time
Starring: Vijay, Sneha, Prashanth, Prabhu Deva, Mohan
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills