Boeing lays out plan to reform

Posted on: Aug. 2nd, 2006 || Source: seattlepi.nwsource.com | E-mail Article | Print Article

Boeing lays out plan to reform

WASHINGTON -- The Boeing Co.'s booming present collided with its soiled past Tuesday as the Senate Armed Services Committee sought assurances that the company's ethical failures have been corrected and raised questions about a $615 million fine to settle corruption charges.

Boeing CEO Jim McNerney, however, avoided the harsh questions that many expected after the company announced last week that it would not claim a tax deduction on $565 million of the fine. Lawmakers from both parties have questioned how a fine can be an effective deterrent and punishment if a company is allowed to deduct the fine from its taxes.

Sensing the political storm, McNerney said the company would pay the entire fine.

"We recognize that the mistakes were ours and ours alone," he said. "And the problems that enabled those mistakes are ours to correct. Accordingly, we are not taking tax deductions for the $615 million in settlement charges that we will pay to the U.S. government."

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