DOJ Issues First 'Near-Miss' Enforcement Deal in OFAC Sanctions Case
DOJ announced its first 'near-miss' non-prosecution deal linked to OFAC sanctions failures.
Why it matters: Legal teams at multinational firms face stricter DOJ scrutiny on sanctions compliance. This new 'near-miss' enforcement underscores the importance of timely, robust self-disclosure and due diligence.
- The DOJ’s first ‘near-miss’ non-prosecution agreement was with Extreme Networks announced on October 27, 2026.
- Extreme Networks paid nearly $1M in criminal penalties: $487,860.92 in fines and $487,860.92 in forfeiture.
- A parallel OFAC settlement imposed a $1.53M administrative penalty for sanctions violations.
- Between 2018-2022, Extreme Networks’ Russian subsidiary fulfilled 11 orders to a sanctioned Russian weapons manufacturer, MMZA.
On October 27, 2026, the U.S. Department of Justice (DOJ) announced its first 'near-miss' non-prosecution agreement (NPA) under its Corporate Enforcement and Voluntary Self-Disclosure Policy, involving Extreme Networks, Inc.
The policy, introduced in March 2026, incentivizes companies to disclose misconduct promptly to avoid prosecution. A 'near-miss' classification applies when disclosures are untimely but companies cooperate fully and remediate effectively, resulting in an NPA rather than prosecution.
Extreme Networks agreed to pay $975,721.84 in criminal penalties—split evenly between fines and forfeiture—related to its Russian subsidiary’s unlawful sales between March 2018 and March 2022. These included 11 purchase orders fulfilled to Moscow Machinery Building Plant Avangard (MMZA), a sanctioned Russian weapons manufacturer.
Alongside the DOJ action, the U.S. Office of Foreign Assets Control (OFAC) imposed a $1,529,685 administrative penalty on Extreme Networks for violating U.S. sanctions.
The DOJ noted Extreme Networks’ self-disclosure was untimely, occurring only after an impending public report. Assistant Director Roman Rozhavsky of the FBI’s Counterintelligence and Espionage Division said, “This non-prosecution agreement and million-dollar criminal penalty mark the successful resolution of our investigation into the illegal sale of advanced networking equipment... in clear violation of U.S. sanctions and export controls.”
This landmark case tightens expectations for sanctions compliance programs and highlights the risks of delayed self-reporting, even when accompanied by cooperation and remediation efforts.
By the numbers:
- $975,721.84 — total criminal penalties imposed on Extreme Networks
- 11 — sanctioned purchase orders fulfilled by Extreme Networks’ Russian subsidiary
- $1,529,685 — OFAC administrative penalty for sanctions violations
Yes, but: While Extreme Networks avoided prosecution through the 'near-miss' NPA, its untimely self-disclosure underscores DOJ’s insistence on promptness in voluntary disclosures.
What's next: Expect increased DOJ enforcement under the Corporate Enforcement Policy with keen focus on sanctions due diligence and earlier voluntary disclosures.