As of this week, the DOJ has proposed a new plea deal requiring Boeing to plead guilty to fraud charges relating to intentionally misleading the Federal Aviation Administration (FAA) - a decision that resulted in the deaths of 346 people in two separate plane crashes. This latest development sees the DOJ imposing an additional $244 million fine, but perhaps more significantly they have stipulated that Boeing must undergo three years of external monitoring- a manoeuvre intended to prevent such grave oversights and intentional fraudulent activity until such a time as Boeing can be trusted again.

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Perhaps now is the time to re-examine the fatal ramifications of Boeing’s misdeeds in relation to regulatory scrutiny- not just imposing a temporary external audit but overhauling the aviation sector to significantly change the laws regarding aviation safety standards and their appraisals in general. The ongoing legal and regulatory fallout emphasises the need for rigorous safety protocols and transparent communication in all high-stakes industries and flags the importance of external audits. The nature of a temporary supervision simultaneously places absolute trust in all other airlines to comply whilst also introducing an element of pay-to-play. The wider debate of what motivates companies, and indeed whole sectors, to comply with regulations rears its head once more: is it the consequences of getting caught or the moral and ethical code they themselves uphold that drives them towards regulatory compliance? 

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Another question, and perhaps one more fitting, is why we are continuously shocked by revelations of scandals by perpetrators close to regulatory bodies.

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Boeing’s proximity and relationship with the FAA has been under intense scrutiny since the crashes of their 737 Max aircraft in 2018 and 2019. This line of investigation raises questions about the degree of oversight exhibited and the relationship between the regulatory body and Boeing. The FAA has a system in place named the Organisation Designation Authorisation (ODA) which allows manufacturers such as Boeing to perform certain certification tasks on their own, on behalf of the FAA. Although this system is designed to leverage industry expertise and resources to expedite certification processes, it naturally benefits the manufacturers who partake- affording them a greater leniency.

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Due to this long-standing relationship and Boeing’s reputation as one of two frontrunners for global aviation manufacturing, the FAA became lax, placing implicit trust in the manufacturer’s assurances. In the case of the 737 Max incidents, this loomed large when the FAA certified Boeing’s new plane for commercial service based primarily on assurances from the manufacturer that the aircraft’s new Manoeuvring Characteristics Augmentation System (MCAS) did not require major additional pilot training.

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Boeing did not disclose to the FAA that the new and “improved” MCAS system could automatically push the plane’s nose downwards based on signals from a single AoA (Angle of Attack sensor). The sensors are a crucial component of an aircraft’s flight control system - measuring the angle between the wing chord line and the direction of the oncoming airflow - directly affecting the amount of lift generated by the wings as a response. In the Boeing 737 Max, only one sensor was linked to the MCAS- meaning any faulty readings could not be cross-checked with a second sensor and would unnecessarily trigger a nose-dive.  

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Standing by the assertion that the two MCAS systems were nearly identical, all pilots trained on the older 737 NG model were told they did not need simulator training for the 737 Max - a decision which reduced costs massively for airlines. The pilot manuals did not include any updated information on the MCAS system leaving flight crews entirely unaware of its existence and totally unprepared to respond to the inevitable malfunctions. 

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The FAA’s reliance on Boeing for certain certification tasks was meant to be part of a broader regulatory framework intended to manage the complex demands of aviation safety, however, the 737 Max crashes elucidate the critical weaknesses in this system- namely the conflicts of interest when other elements are at play. 

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It is no coincidence that these significant safety flaws were overlooked at a time when Boeing was racing against their largest competitor, Airbus, to release a new plane. The Airbus A320neo was a new workhorse for short to medium-haul routes with improved fuel efficiency and better aerodynamics, both of which affected run costs and competitive performance. With the new Airbus representing a significant portion of the European manufacturer’s backlogged orders, Boeing felt the pressure to counter. The creation of the Boeing 737 Max and the subsequent hurrying through its safety procedures was a direct response to the competitive pressure of the A320neo. The utilisation of only one AoA sensor and poor MCAS system resulted from Boeing attempting to match Airbus’ fuel efficiency within time constraints and without overhauling the shell of their previous plane.

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The irony in rushing to minimise opportunity cost against their rival resulting in billions of dollars worth of debt is surely not lost on Boeing. More interestingly, while the 737 Max fleet was grounded during the investigations following both crashes, sales of the Airbus A320neo skyrocketed- pun intended. With many airlines turning to Airbus to fill the gap left by the unavailable 737 Max, Airbus managed to capitalise on Boeing’s grave errors.

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This is not the first time there has been regulatory lapses owing to a perpetrator being too close to the authorities to be under suspicion. Parallels can be drawn in the financial world between this scandal and that of Maddof, another figure who was awarded implicit trust by regulators culminating in oversight failures. Maddof and Boeing are just two of many who benefitted from remaining in plain sight and yet beyond speculation. 

Both cases illustrate systemic issues within regulatory frameworks where close ties and boundless trust led to negligence by omission. 

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Had the correct training and manuals been in place, and had Boeing disclosed the changes in MCAS and taken the financial hit for additional training- 346 people would have lived. Additionally, if there had been an ongoing communication surveillance programme and external regulatory compliance frameworks in place then these issues would not have been left to linger until after the fatal accidents. The deadly ramifications and legal fallout of the 737 Max crashes emphasise the necessity of rigorous safety protocols and transparent communication in all sectors. It flags the importance of external audits and the need for real-time monitoring rather than post-hoc investigations. 

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Although other transgressions relating to ill-placed trust from regulatory bodies and figures of authority have all too often resulted in people’s lives being cut short or irrevocably changed for the worse, this is the largest death toll to have occurred as an immediate result of a company flagrantly flaunting regulations. With the jurisdiction and leniency bestowed upon them by regulatory bodies, it is all too easy for companies such as Boeing to give in to external pressures. In the race for innovation (read: capital gains), personal motivations lead to cutting corners which once again spelled disaster for those innocent people left in the contrails.

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