Last year, Extreme Networks Inc, a U.S. technology company, made a public statement announcing the suspension of all business activities in Russia as a gesture of solidarity with the people of Ukraine who were enduring challenging circumstances.
However, recent discoveries have revealed that despite the publicly declared suspension of operations, the most senior manager of Extreme Networks in the region continued to engage in business activities in Russia.
According to interviews with two individuals familiar with the matter, as well as Russian corporate and customs records, Sergey Gusakov, while still employed as Extreme’s manager for former Soviet republics, established his own company in April 2022.
The purpose of his new company was to supply Russian clients with IT equipment produced by a competitor of his employer.
Screenshots obtained from Extreme Networks’ website show Sergey Gusakov, the Russian manager, during his tenure at the company. These screenshots indicate that while working at Extreme, Gusakov established his own company to provide IT equipment to Russian customers.
The equipment supplied by Gusakov’s company, known as Vektor-T, is assembled in China and contains microprocessors manufactured by U.S. chip companies, as confirmed by the individuals familiar with the matter and supporting photographs.
This situation highlights an interesting aspect: microprocessors produced by U.S. chip companies, which have imposed sales bans on their products to Russia (similar to Extreme Networks), have found their way into the country through Chinese equipment.
This observation sheds light on the limitations of U.S. trade restrictions.
An investigation conducted last year revealed that despite voluntary export bans imposed by tech companies and broader Western sanctions implemented after Russia launched a full-scale invasion of Ukraine in February 2022, significant amounts of computer and electronic components worth billions of dollars have continued to flow into Russia through networks of third-party suppliers.
Upon being questioned about his private business, Gusakov dismissed the claims as fictional and ended the conversation without further comment.
Significantly, Gusakov has been running his separate business for more than a year, despite a colleague raising concerns to Extreme Networks’ senior management in the summer of 2022 regarding Gusakov’s participation in selling technology to Russia on the side, potentially breaching company policies.
The details found in screenshots of Sergey Gusakov’s LinkedIn profile validate the gathered information.
These screenshots confirm that while employed at Extreme Networks, the Russian manager established his own company to supply IT equipment to Russian customers, and the equipment was sourced from a Chinese competitor of his employer.
Russian corporate and customs records also support these findings.
A complaint lodged against Gusakov claimed that these violations would significantly damage Extreme Networks’ reputation, particularly in light of the ongoing war in Ukraine.
When asked about Gusakov’s side activities, spokespeople from Extreme Networks disclosed that the matter was currently under investigation by the company’s legal department and external legal counsel.
The spokespeople chose not to comment on the operations of Vektor-T, stating that it was beyond Extreme Networks’ control. Furthermore, they did not provide any response to inquiries regarding Gusakov’s current status with the company.
The spokespeople emphasized Extreme Networks’ firm commitment to adhering to U.S. export controls and stated unequivocally that the company does not conduct any business in Russia.
It should be noted that prior to the invasion of Ukraine, Extreme Networks was exposed for supplying IT equipment to a U.S.-sanctioned military company involved in the production of missiles for Russia’s highly sophisticated S-400 air defense system.
In October, Extreme Networks acknowledged the findings and admitted that their products had ended up in the possession of “bad actors.” They informed U.S. regulators of their intention to investigate both current and former employees for potential involvement and to implement “best in class” export controls.
