Feds Cracking Down with Criminal Convictions against Employers for H-1B and Work Visa Fraud

May 19, 2011

H-1B and other employers who run work visa scams have more to fear than just the Department of Labor for their violations. These employers increasingly are facing criminal convictions and imprisonment on charges typically used against organized crime and trafficking rings, such as the Mafia.

In the past several months, federal prosecutors have publicized several cases against employers who were convicted under trafficking and criminal RICO (Racketeer Influenced and Corrupt Organizations Act) laws for procuring and exploiting foreign workers through visa fraud.

Of note, in March 2011, federal prosecutors in New Jersey reported that the owner of a tech staffing company was sentenced to six months in prison, fined $50,000 and ordered to forfeit an additional $296,921.82 for money laundering in connection with trafficking in immigration documents used to obtain H-1B visas and green cards for Indian workers. Six immigrant employees who paid the employer for the fake visas pleaded guilty and were placed on supervised probation, according to the Department of Justice (DOJ) press release.

The owner, Nilesh Dasondi, pleaded guilty to submitting employment-based visa applications for unqualified and ineligible foreign workers for jobs that did not exist at his company, formerly  Cygate Software & Consulting, now Sterling System LLC. When the workers arrived in the United States, the employer told them to go find jobs elsewhere. The employer then ran fake payrolls for these employees to make it look like they were working for the company. As part of the scam, the employees had to reimburse the employee for this payroll and related expenses, DOJ said.

In April, two other staffing company owners  in Iowa were convicted of H-1B visa fraud and sentenced to more than three years in prison and ordered to forfeit more than $ 1 million in proceeds. Fazal Mehmood and Viheet Maheshwari, who ran Worldwide Software Services and Sana Systems, plead guilty to applying for H-1B visas for foreign workers that contained false statements about their jobs and work locations typical of body shop scams, according to DOJ. For example, they told the government that employees would be working as programmers and analysts, but those jobs did not exist.

In an unrelated case, eight co-workers of  several connected Missouri and Kansas staffing companies that provided labor to the service and construction industries nationwide were similarly convicted of human trafficking and RICO charges for securing visas for illegal workers, DOJ said. The employers exploited the workers by threatening deportation if they complained about the working conditions that amounted to indentured servitude. They were forced to live in crowded apartments for which they were charged exorbitant rents, they worked but were not paid for overtime, and numerous “fees” were deducted from their paychecks resulting in negative earnings ensuring their “debt” to the employer could never be paid.

The Department of State has launched a public education campaign to combat exploitation and trafficking of foreign workers. More information on this resource is available in our blog article Handy Government Guide to Employee Rights; Download and Keep It With You.

If you believe the visa application your employer submitted for your visa may have contained false statements, you should contact an attorney as soon as possible.

For more information about legal services for H-1B employees who suspect they have been victims of employer fraud, please visit our co-authored H-1B Legal Rights blog, blog page here.