Justice Department announces criminal settlement with NC company over exports to Russia

WASHINGTON, D.C. (WWAY) — The Department of Justice announced Tuesday it entered into a non-prosecution agreement with Extreme Networks, Inc. The company designs and sells A.I. and cloud networking systems.

The company agreed to pay criminal penalties totaling $975,721.84 to resolve the Department’s investigation of sanctions and export control offenses.

The DOJ reached the agreement under its 2026 Corporate Enforcement and Voluntary Self-Disclosure Policy, which incentivizes companies to voluntarily disclose discovered misconduct.

This agreement with Extreme Networks marks the Department’s first non-prosecution agreement in a “near-miss” case under the Policy, meaning a case that involved full cooperation and appropriate remediation but did not qualify for a declination of prosecution.

While Extreme Networks’ disclosure to the National Security Division (NSD) was not timely because it occurred under imminent threat of disclosure by a news publication, Extreme Networks nonetheless fully cooperated with the Department’s investigation and timely and appropriately remediated the misconduct.

“This non-prosecution agreement and million-dollar criminal penalty mark the successful resolution of our investigation into the illegal sale of advanced networking equipment and services to a Russian weapons manufacturer, in clear violation of U.S. sanctions and export controls,” said Assistant Director Roman Rozhavsky of the FBI’s Counterintelligence and Espionage Division.

“The FBI remains dedicated to keeping sensitive technology out of the hands of the Russian military, and we’re grateful to Homeland Security Investigations and the Bureau of Industry and Security for their partnership on this case.”

The agreement arose out of an investigation into Extreme Networks’ sales of products and services to Moscow Machinery Building Plant Avangard (MMZA), a Russian weapons manufacturer that was owned by JSC Concern Almaz-Antey (Almaz Antey), which was added to the Specially Designated Nationals and Blocked Persons List by the Department of the Treasury’s Office of Foreign Assets Control (OFAC) in July 2014.

Pursuant to the non-prosecution agreement, Extreme Networks will forfeit $487,860.92 in proceeds from the sanctions and export control offenses and pay a criminal fine of $487,860.92, for a total criminal penalty of $975,721.84. Extreme Networks will also resolve a parallel administrative action by OFAC.

Between around March 2018 and March 2022, Extreme Networks, through its then-Russia based subsidiary, Extreme Networks Rus LLC, processed and fulfilled 11 purchase orders for networking equipment and services to MMZA without the required license or authorization from OFAC.

MMZA was a primary producer of the S-300 and S-400 anti-aircraft missile systems used by the Russian army.

To facilitate these sales, certain Russia-based Extreme Networks employees concealed the identity of MMZA from Extreme Networks’ global trade compliance group, causing Extreme Networks to file false electronic export information via the Automated Export System and smuggle goods from the United States.

The FBI Charlotte Field Office, the Department of Commerce’s Bureau of Industry and Security, and Homeland Security Investigations investigated the case.