Feds Struggle with H-1B Case

A court finds federal investigators acted recklessly in the aftermath of last year's bust of an alleged nationwide H-1B scam ring, arresting 11 people in seven states and bringing a 10-count indictment against a New Jersey IT services firm, Vision Systems Group.

More than a year ago, federal agents arrested 11 people in seven states for submitting false statements and documents in support of their H-1B visa petitions. The Department of Justice also issued indictments against IT services firm Vision Systems Group of New Jersey for conspiracy and mail fraud involving H-1B visas.

The federal investigation involves companies that sponsor primarily H-1B non-immigrants. Vision Systems officials have claimed their H-1B workers have been brought to the United States to fill existing IT vacancies. The feds claim the companies have not always had jobs available for these workers, placing them in non-pay status after they arrive in the United States.

Vision Systems is suspected of visa fraud, mail fraud, wire fraud, money laundering and conspiracy.

The evidence seems strong, but the case began to unravel since it has reached court in Iowa. The judge presiding over the case has already dismissed a number of counts related to charges involving mail fraud, knocking out eight of the 18 counts.

The judge followed with a ruling that the search warrants issued the day of arrests were "over-inclusive" and not limited to the warrant. The warrant required the feds to make its examination of the digital images within 60 days, which they did not.

A favorite of American technology companies, the H-1B program is a temporary work visa program allowing American companies and universities to employ foreign guest workers who have the equivalent of a U.S. bachelor's degree in a job category that is considered by the UCCIS (U.S. Citizenship and Immigration Services) to be a "specialty occupation." The idea is to help companies hire foreign guest workers on a temporary basis when there is not a sufficient qualified American workforce to meet those needs.

The Silicon Valley has repeatedly urged Congress to raise the H-1B cap, which is currently set at 65,000 per fiscal year, but lawmakers have resisted, citing concerns over fraud in the H-1B program. H-1B visa winners can work in the United States for three years, with an option for an additional three years.

In October 2008, a USCIS report found that the H-1B program had more than a 20 percent violation rate. The fraud identified in the report included jobs not located where employers claimed, H-1B visa holders not being paid the prevailing wage, forged documents, fraudulent degrees and "shell businesses."

Even before the report was issued, Sens. Charles Grassley of Iowa, Dick Durbin of Illinois and Bernie Sanders of Vermont were seeking reform of the H-1B visa program. A bill introduced in the 110th Congress by Grassley and Durbin would require employers to make a good faith effort to hire American workers first. Employers would also have to show that the H-1B worker would not displace an American worker.