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U.S. employers are again on the hunt for H-1B visas, with demand for the controversial temporary work visas rising sharply over the last two months. According to the most recent numbers issued by U.S. Citizenship and Immigration Services, the late rush has pushed the number of H-1B visa petitions to 58,900.
The Congressionally mandated yearly cap for H-1B visas is 65,000. Despite an early slump in demand, the cap is likely to be reached again this year. In 2008, the H-1B quota was met in one day.
Historically, the demand for H1-B visas directly correlates with the state of the economy. In the 1990s, as the tech economy sizzled, Congress kept raising the cap, which peaked in 2001 with 163,000 issued of 195,000 available H1-Bs. When the tech bubble burst and the Silicon Valley economy began to fizzle, the number of visas issued fell to 79,000. By 2004, Congress had dropped the cap to the current 65,000 but appeased tech companies by granting an additional 20,000 H1-Bs for advanced degree workers.
Adding to 2009’s slow start is a new law that bars financial companies receiving federal bailout funds from applying for H1-B visas.
Critics of the program have long claimed U.S. employers are using H1-B visas to hire workers for less than the U.S. prevailing rate, but the controversy gained serious traction after the government released a 2008 report highlighting rampant fraud in the program. The report revealed a more than 20 percent violation rate by employers using the H-1B visa program.
In February, federal agents conducted H-1B-related raids that resulted in 11 arrests across seven states. According to the Department of Justice, the scheme involved hiring college-educated foreign workers ostensibly to 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.
The investigation seems to center on Vision Systems Group, of South Plainfield, N.J., and Praveen Andapally, president of VenturiSoft, also based in South Plainfield. Among the others indicted was Vishnu Reddy, president of Pacific West, of Santa Clara, Calif.
Two months before those arrests, the hammer had already fallen on a Massachusetts scheme in which a state employee allegedly created bogus H-1B job certifications. Four men were charged Dec. 4 with producing documents falsely stating that H-1B visa applicants had jobs with the commonwealth of Massachusetts. Richard Schwartz, a now former Massachusetts employee, signed the documents and is charged with one count of visa fraud, which could mean penalties of up to five years in prison time and a $250,000 fine.