US prosecutors hit Boeing with a $2.5 billion fine to settle charges that the company defrauded regulators over the 737 Max, the American Justice Department announced today.

Boeing's chief executive said the settlement was "the right thing" to address the company's failings.

"I firmly believe that entering into this resolution is the right thing for us to do - a step that appropriately acknowledges how we fell short of our values and expectations," David Calhoun said in a statement.

"This resolution is a serious reminder to all of us of how critical our obligation of transparency to regulators is, and the consequences that our company can face if any one of us falls short of those expectations."

The 737 Max was grounded for 20 months after two deadly crashes and only recently was cleared to return to the skies.

Prosecutors described Boeing's failings in withering terms, accusing the company of putting "profit over candour" and of engaging in a "half-truths" and a "cover up."

Boeing reached a $2.5 billion deferred prosecution agreement after the US Department of Justice (DOJ) charged it with concealing information about the Maneuvering Characteristics Augmentation System (MCAS).

This anti-stall process was a prime factor in crashes of Lion Air and Ethiopian Airlines flights that together claimed 346 lives.

Boeing, through two Max pilots, concealed key information about MCAS to the Federal Aviation Administration, the DOJ said.

This omission meant the FAA did not mention MCAS in its final report certifying the Max, so there was no reference to the system in manuals and pilot training materials.

After the Lion Air crash in October 2018, the FAA "learned for the first time" key details about the MCAS "that Boeing concealed from FAA," the DOJ said. 

And two pilots at Boeing "continued misleading others - including at Boeing and the FAA - about their prior knowledge of the change to MCAS".

Regulators grounded the Max in March 2019 following a second fatal accident. 

Both Boeing and FAA have come under intense scrutiny for not grounding the plane after the first calamity and for what critics called the lax oversight when the plane was rolled out.

The DOJ said the size of the penalty reflected Boeing's conduct, including the company's initial reluctance to cooperate in the probe.

Boeing's cooperation "was delayed and only began after the first six months of the Fraud Section's investigation, during which time Boeing's response frustrated the investigation," the department said.