Extreme Networks Agrees to $2.5 Million Fine for Sales to Russian Missile Maker

Extreme Networks will pay $2.5 million to resolve allegations that it violated U.S. sanctions by selling networking equipment to a Russian company that supplied missile systems to the Russian military. The settlement was announced Tuesday.

The U.S. government alleged that between March 2020 and September 2023, Extreme Networks sold products to a Russian distributor that subsequently supplied the equipment to a Russian entity involved in the development and production of missile systems for the Russian Ministry of Defense. This violated sanctions imposed by the U.S. following Russia's 2014 annexation of Crimea and subsequent actions.

Under the terms of the settlement with the U.S. Department of Justice and the Commerce Department, Extreme Networks did not admit or deny the allegations. The company agreed to a compliance agreement and will implement enhanced controls to prevent future violations. The settlement also requires the company to cooperate with U.S. authorities.

In a separate development also noted by The Morning Risk Report, the U.K.'s Serious Fraud Office (SFO) is reportedly seeking to emulate aspects of the U.S. whistleblower program as it develops its own. Additionally, a report cited in the same notes indicates a 57% decrease in Securities and Exchange Commission (SEC) enforcement activity.