DOJ Charges Phone-Hacking Firm Leaders Over Hidden Russian Ownership

The US Department of Justice has arrested two leaders of Oxygen Forensics, a phone-hacking software company, accusing them of hiding the firm's Russian ownership in order to win contracts with agencies including the Secret Service, Homeland Security Investigations, the DHS inspector general and the Department of Defense. Lee Reiber, the company's US-based CEO, was arrested in Idaho, while Oleg Davydov, alleged to be one of five Russian nationals who actually control the company, was arrested in London and faces extradition. Both are charged with conspiracy to commit wire fraud.

According to a criminal complaint, Oxygen publicly presented Reiber as the true head of its Virginia-based US operation, but Russian executives allegedly overruled him on key decisions. The company reportedly restructured after the US expanded sanctions on Russia in 2022, installing Reiber as CEO and removing Russian owners from public filings, even as shareholders continued making major decisions behind the scenes. Since then, Oxygen has won more than $2 million in contracts and purchases from the Secret Service and its National Computer Forensics Institute, with Reiber allegedly asserting US ownership as recently as February this year.

The case also highlights broader concerns about Oxygen's software, which has reportedly been used by Russia's FSB through a related entity, Oxygen Russia. The company has separately faced allegations of using reverse-engineered code from a competitor's product.