Justice Department Charges Oxygen Forensics CEO and Russian Businessman with Wire Fraud

The Justice Department has charged the chief executive of a Virginia-based software company and a Russian businessman with lying to the U.S. government for years about who controlled the firm, according to a statement Wednesday.

The case came after a former employee publicly made similar allegations that prompted Oxygen Forensics to sue him.

Lee Reiber, 55, chief executive of Oxygen Forensics, was arrested Sunday in Boise, Idaho, where he lives, and released on bond. He is expected to be arraigned in federal court in Los Angeles in the coming weeks.

His co-defendant, Oleg Davydov, 52, of Moscow, was arrested the same day at London's Heathrow Airport, as he prepared to board a flight to Istanbul. U.S. authorities said they were expected to seek his extradition.

Both men are charged with conspiracy to commit wire fraud, a federal offense that carries a maximum sentence of 20 years in prison.

Oxygen Forensics sells digital forensics software that law enforcement and government agencies use to extract and analyze data from phones and computers. Its customers were reported to include the U.S. Secret Service, Homeland Security Investigations and the Department of War, the Pentagon's current official name.

According to a criminal complaint, the company told those agencies for several years that it was independently owned and operated in the U.S. — a claim that prosecutors allege to be false. Davydov and four other Russian nationals secretly owned and controlled Oxygen Forensics through a holding company in Cyprus, and its software was written by a team in Russia that Davydov directed, according to the document.

Reiber became CEO in March 2022, shortly before the Russian owners' names were removed from the company's public filings, in the wake of Washington expanding sanctions on Moscow after the invasion of Ukraine.

The Russian owners allegedly retained control behind the scenes, setting Reiber's pay and holding authority over the company's bank accounts. In December 2022 and October 2023, Reiber signed government paperwork falsely stating the company was independent and had no external owner, according to the complaint.

That certification helped Oxygen secure a five-year, $12 million contract with a Secret Service training unit in 2024.

When a reporter asked about the company's Russia ties in late 2023, Reiber warned his Russian partners the coverage "could destroy this entire opportunity," the complaint states. As recently as March, prosecutors say, Reiber denied any Russian ownership or involvement in the software's development during a recorded call with undercover agents posing as Homeland Security officials.

Investigators seized Oxygen's corporate bank accounts and roughly 57 of its web domains last week under a warrant issued Sept. 19.

The government's allegations closely track claims made by Max Weissberg, a former Oxygen employee, in a YouTube video in February, months before the arrests.

Weissberg said 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 denied those claims and sued Weissberg for defamation in August in federal court in Virginia, calling the video part of a retaliatory campaign.

The U.S. Department of Commerce's Bureau of Industry and Security is investigating the Oxygen Forensics case with assistance from the Department of War Office, Ciaran McEvoy, public information officer at the attorney's office said in the statement, noting that all defendants are presumed innocent unless proven guilty in court.