Digital forensics firm with US federal contracts covered up ties to Russia, DOJ alleges

The Department of Justice announced Wednesday that it arrested two principals at a data extraction and digital forensics company that sold several U.S. agencies its software while allegedly lying about foreign ownership and the fact that its technology is made in Russia.

The Departments of Defense (DOD) and Homeland Security (DHS) bought Oxygen Forensics’ software after allegedly being lied to about its foreign ties, according to a press release. DHS branches — including the Secret Service, the National Computer Forensics Institute (NCFI), Homeland Security Investigations and the Office of the Inspector General — all used the firm’s products.

Oxygen is a direct competitor of the well-known digital forensics company Cellebrite, whose work with authoritarian governments has drawn worldwide attention. Digital forensic software is frequently used by law enforcement and intelligence agencies to break into phones.

The firm reportedly has nearly 10,000 contracts in more than 150 countries.

Oxygen CEO Lee Reiber, 55, of Boise, Idaho, was arrested Sunday and has been released on bond. 

Moscow resident Oleg Sergeyevich Davydov, 52,  was arrested the same day in London and was Oxygen’s chief technology officer. Federal authorities said they plan to seek his extradition to the U.S. 

Both men were charged with conspiracy to commit wire fraud and face up to 20 years in prison. On September 20, U.S. authorities seized about 57 domains, cyber infrastructure and corporate bank accounts belonging to the firm.

Reiber allegedly told government agencies interested in entering into a contract with Oxygen that “its software was developed in the United States, when in fact five Russian nationals, including Davydov, owned and controlled the company and its software was developed in Russia,” according to a DOJ affidavit.

Davydov and four other Russian nationals allegedly hid behind a holding company based in Cyprus though Oxygen is formally headquartered in Virginia, prosecutors said.

Russia’s Federal Security Service (FSB), the Russian Investigative Committee and the Russian Ministry of Internal Affairs also bought software from a separate Davydov company selling the same software under a different name, according to the press release.

Authorities are not alleging that the software was deployed to gain unauthorized access to customers’ data or computer systems, and there is also no evidence that the software was embedded with malicious code, the DOJ said.

Oxygen’s website has been seized by authorities and is down. The company has previously said its tools allow investigators to extract and analyze digital data from several sources, including the cloud, drones and mobile devices.

Evading sanctions

Prosecutors say the scheme was developed after Russia invaded Ukraine and the U.S. imposed new sanctions, prompting Oxygen to remove the Russians’ names from the company’s corporate filings.

Reiber became the CEO, president and chairman of the board in March 2022, soon before the corporate filings were changed, prosecutors say. 

“The company’s Russian owners continued to make significant decisions and set Reiber’s compensation, overruled him on payments, and held signatory authority over the company’s bank accounts,” even after Reiber’s appointment, the press release said.

In November 2023, a journalist asked Reiber about the Russian ties, prompting him to allegedly write to Davydov, saying media attention “could destroy this entire opportunity.” Prosecutors allege the opportunity he referred to was a pending contract with the NCFI. 

In September 2024, the NCFI signed a five-year deal with Oxygen, noting in its filing that Reiber had certified that Oxygen had no “immediate or higher level owner.”

Almost a year later, prosecutors say, Oxygen also certified to the Department of Defense that “no foreign person had the power to control the appointment of the company's directors or managers or to direct its other decisions or activities.”

In 2026, Reiber allegedly told DHS officials that no Russians were involved in making its software.

Oxygen has long been on the radar of digital rights advocates, who say the company's Russian ties were an open secret.

“No surveillance tool should come anywhere near a US investigation until we know who owns it, who builds it, and who else they are selling to,” said Natalia Krapiva, senior tech legal counsel at Access Now. 

“The same software sold to US law enforcement was used by the FSB to pull data off the phones of anti-war Russians and turn it into criminal charges,” she added. 

“When governments buy technologies from shady companies like Oxygen and take their word for it, we don't just risk our own security, but we also risk funding someone else's repression.”