The CEO of Virginia-based Oxygen Forensics, Lee Reiber, and Russian national Oleg Davydov have been arrested and charged with conspiracy to commit wire fraud. The charges allege they deliberately concealed the company’s Russian ownership and control from the U.S. government for years.
The allegations mirror claims made by a former employee, leading to a defamation lawsuit by Oxygen Forensics before the criminal charges became public. Oxygen Forensics, a provider of digital forensics software, counts agencies like the U.S. Secret Service and Homeland Security Investigations among its clients.
Virginia Tech Firm CEO and Russian National Charged in Scheme to Conceal Russian Ownership from U.S. Government
By: Reuters
Date: March 22, 2019 (Note: The provided content references a March 22, 2019 image date, but the article details events occurring in late 2023 and early 2024. The actual article publication date is not explicitly stated in the provided text, so this date is based on the image caption.)
Key Points
- Lee Reiber, CEO of Virginia-based Oxygen Forensics, and Russian national Oleg Davydov arrested for allegedly hiding the company's Russian ownership from the U.S. government.
- Charges stem from allegations made by a former employee, which Oxygen Forensics had previously sued over.
- Oxygen Forensics' clients reportedly include U.S. Secret Service, Homeland Security Investigations, and the Department of War.
Article Details
The Justice Department has brought charges against the chief executive of a Virginia-based software company and a Russian businessman, accusing them of years-long deception to hide the firm's true ownership from the U.S. government. This development follows public claims made by a former employee, which had previously led Oxygen Forensics to initiate legal action against him.
Lee Reiber, 55, the CEO of Oxygen Forensics, was apprehended on Sunday in Boise, Idaho, and subsequently released on bond. His arraignment in federal court in Los Angeles is anticipated in the coming weeks. His co-defendant, Oleg Davydov, 52, of Moscow, was arrested the same day at London Heathrow Airport while attempting to travel to Istanbul. U.S. authorities are reportedly pursuing his extradition.
Both individuals face charges of conspiracy to commit wire fraud, an offense that carries a maximum penalty of 20 years in prison. Oxygen Forensics specializes in digital forensics software, a tool utilized by law enforcement and government agencies for data extraction and analysis from electronic devices. Its client roster reportedly includes prestigious organizations such as the U.S. Secret Service, Homeland Security Investigations, and the Department of War.
According to the criminal complaint, Oxygen Forensics repeatedly assured these agencies that it was independently owned and operated within the U.S. Prosecutors allege this representation was false. The complaint states that Davydov and four other Russian nationals secretly owned and controlled Oxygen Forensics through a Cypriot holding company, with the company's software developed by a team in Russia under Davydov's direction.
Reiber assumed the CEO position in March 2022, shortly before the names of the Russian owners were removed from public company filings. This change occurred amidst the expansion of U.S. sanctions against Moscow following the invasion of Ukraine. Despite the apparent shift, the Russian owners allegedly maintained clandestine control, influencing Reiber's compensation and directing the company's bank accounts. The complaint details that Reiber signed government documents in December 2022 and October 2023, falsely certifying the company's independence and lack of external ownership. These certifications were instrumental in Oxygen Forensics securing a five-year, $12 million contract with a Secret Service training unit in 2024.
Further highlighting the alleged deception, the complaint notes that Reiber, when questioned by a reporter about the company's Russian ties in late 2023, warned his Russian partners that such coverage "could destroy this entire opportunity." Moreover, as recently as March, Reiber reportedly denied any Russian ownership or involvement in the software's development during a recorded conversation with undercover agents posing as Homeland Security officials.
Investigators executed warrants last week, seizing Oxygen's corporate bank accounts and approximately 57 web domains. The government's allegations bear a strong resemblance to claims previously made by Max Weissberg, a former Oxygen employee, in a February YouTube video. Weissberg asserted that the company was "secretly controlled" by a Russian firm with "close ties to the Kremlin," that "100% of the programmers are in Russia," and that Reiber was "paid to hide the truth." Oxygen Forensics vehemently denied these accusations, suing Weissberg for defamation in August in federal court in Virginia, characterizing the video as part of a retaliatory campaign.
The U.S. Department of Commerce's Bureau of Industry and Security, with assistance from the Department of War Office, is leading the investigation into the Oxygen Forensics case. Ciaran McEvoy, public information officer at the U.S. Attorney's office, emphasized that all defendants are presumed innocent until proven guilty in a court of law.
