U.S. watchdog will review FAA decision to unground Boeing 737 MAX

By David Shepardson

WASHINGTON (Reuters) - The U.S. Transportation Department's Office of Inspector General said on Tuesday it will audit the Federal Aviation Administration's (FAA) November decision to unground the Boeing 737 MAX and other agency decisions.

The 737 MAX was grounded in March 2019 after two crashes in Indonesia and Ethiopia within five months killed 346 people. The FAA approved its return to service after significant safety enhancements developed during the plane's 20-month grounding.

The new audit will examine the FAA’s actions following the two accidents, including the agency's risk assessments, the grounding of the aircraft and the subsequent recertification, the inspector general's office said. Boeing declined to comment.

The inspector general's office added "its objective is to evaluate FAA’s processes and procedures for grounding aircraft and implementing corrective actions."

The FAA said it "will cooperate fully with the Inspector General’s audit, as it has with all other outside reviews of the agency’s oversight of the Boeing 737 MAX."

FAA Administrator Steve Dickson told Reuters in November he was "100% confident" in the safety of the 737 MAX.

The FAA imposed new training requirements to deal with a key safety system called MICAS that was blamed for the two fatal crashes as well as significant new safeguards and other software changes to ensure the system does not erroneously activate.

The inspector general issued two prior reports on the 737 MAX including one in February that outlined "weaknesses" in the FAA's certification of the aircraft.

Legislation signed into law in December revamped the FAA’s aircraft certification program and required an independent review of Boeing's safety culture.

Boeing agreed to a $2.5 billion settlement with the Justice Department in January as part of a deferred prosecution agreement after the government said the crashes "exposed fraudulent and deceptive conduct by employees of one of the world’s leading commercial airplane manufacturers."

(Reporting by David Shepardson; Editing by Leslie Adler, Peter Cooney and Jane Wardell)