More IT Vendors Make H-1B Scam List
Small Iowa communities were used as nothing more than mail drops in an elaborate H-1B visa fraud scheme that allowed foreign workers to illegally work on the East and West coasts while being paid the lower Iowa prevailing rates. Two IT services firms in New Jersey and one in California may be at the heart of the H-1B visa scam, but federal prosecutors warn current indictments are "just the tip of the iceberg."Two New Jersey IT services firms allegedly used shell businesses in two small Iowa towns-Coon Rapids and Clive-as part of an elaborate H-1B visa fraud scheme that began to unravel Feb. 11 with the arrests of 11 individuals in seven states. According to the U.S. Department of Justice, the scheme involved hiring college-educated foreign workers to allegedly fill high-tech jobs in Iowa when, in fact, the workers were sent to the East and West coasts while being paid the lower prevailing Iowa wage rate.
In other cases, the DOJ claims, foreign workers were recruited and H-1B visas were obtained for nonexistent jobs or the workers were placed in jobs and locations not previously certified by the Department of Labor, replacing qualified American workers and violating prevailing wage laws.
In multiple indictments revealed by the DOJ Feb. 12, the investigation seems to center on Vision Systems Group of South Plainfield, N.J., and Praveen Andapally, identified as president of VenturiSoft, also based in South Plainfield. The other indictments include Vishnu Reddy, who was identified as president of Pacific West of Santa Clara, Calif.
U.S. Attorney Matthew Whitaker said at a Feb. 12 press conference that the indictments were "just the tip of the iceberg" when it comes to U.S. visa fraud. "This is an enforcement effort that points to a significant vulnerability in our visa process, and we're trying to close these loopholes and to take away the incentive to conduct these fraudulent schemes," Whitaker said.
Vision Systems Group faces charges of one count of conspiracy and eight counts of mail fraud and is looking at $7.4 million in forfeitures. Andapally also faces one conspiracy count, six counts of mail fraud, three wire fraud counts and two counts of making a false claim on an immigration matter. Reddy is charged with various conspiracy, mail and wire fraud counts.
Each conspiracy count carries a maximum penalty of five years in prison and a $250,000 fine. Mail and wire fraud carry maximum sentences of 20 years in prison and a $250,000 fine, while false statements to immigration officials can involve up to 10 years of prison time and a $250,000 fine.
Vision Systems Group stated in numerous documents submitted to federal authorities that it established a Coon Rapids branch office in 2003, but Coon Rapids Mayor Keith Dorpinghaus told the Daily Times Herald of Carroll, Iowa, "I know they had an office in town a couple years ago, but that's about it. I never met anybody from the company."
Doug Carpenter, president of the Coon Rapids Development Group, told the Times Herald, "There seems to be a general lack of knowledge about the company and office here. It seems to have been a mail drop, more or less."
Andapally's VenturiSoft lists Clive as a "contact" office on its Web site, while Reddy's Pacific West maintains no apparent Web site. A Web search for the company does reveal, however, a Pacific West office in Urbandale, Iowa.
Repeated calls to all three companies were not returned.