The Boeing Co. has agreed to pay $615 million to settle federal investigations into contracting scandals at the company, according to reports in The Wall Street Journal and The Seattle Times. Though Boeing declined comment on the reports, a source familiar with the settlement told the Journal the fine was "the largest financial penalty ever imposed on a military contractor for weapons-program improprieties." The Journal reported that prosecutors have agreed not to move against Boeing or executives as long as the company and senior management don't break the law in the next two years.
The alleged improprieties involve Boeing's illegal recruitment of an Air Force procurement official, which led to the 2003 firing of Boeing's CFO and the resignation of CEO Phil Condit, and a scandal involving Lockheed Martin documents that were improperly acquired by Boeing when the companies were competing for government rocket launches in the 1990s. According to The Journal, Boeing will only acknowledge improper behavior by a few employees, not that prosecutors have evidence to justify seeking felony charges against the company.