The Feds say they closed a loophole that paved the best way for enormous fraud

Scammers exploiting a change in the appliance process for the controversial H-1B visa have been stopped by a brand new rule, federal authorities say.

After U.S. Citizenship and Immigration Services introduced a brand new, two-step visa application process for employees with special skills in 2020, unscrupulous businessmen worked together to game the lottery-based allocation system, a Citizenship and Immigration Services spokesman said .

The latest process was intended to scale back application costs by allowing firms to file initial $10 “registrations” to draw potential foreign employees to the H-1B lottery, relatively than incurring 1000’s of dollars in fees and legal costs to pay a chance with poor odds – only 85,000 New visas are issued yearly and the variety of applications typically runs into the a whole lot of 1000’s.

But a flaw in the method emerged: There was no requirement for firms to supply information akin to passport numbers that will discover individual potential visa recipients. Shortly after the brand new system was implemented, several employers began organising latest firms and collaborating to submit multiple applications for a similar employees to extend their probabilities of winning the lottery, the agency's spokesman said. Registrations rose from about 275,000 in the primary yr to just about 800,000 last yr, in keeping with the agency.

“A typical program would involve a small number of employers setting up dozens or more paper companies and repeatedly registering hundreds, if not thousands, of workers with the same paper companies to increase the chances that one of those workers will be selected,” the spokesman said .

The perpetrators probably intended to outsource foreign employees to their customer firms using fraudulently obtained visas, the spokesman said.

Citizenship and Immigration began aggressive investigations last yr, and agency officials referred an unknown variety of alleged perpetrators to law enforcement for possible fraud prosecution, the spokesman said. The variety of final applications submitted to the agency suggested that its public messages about cracking down on fraud seemed to be pushing a lot of those that had manipulated the registration process to desert their efforts, even in the event that they had been successful within the lottery were, he said.

For the registration process earlier this yr, Citizenship and Immigration modified the principles to require individual identification of passport or travel document numbers. The latest procedure appears to have solved the fraud problem, the spokesman said. Registrations fell to about 480,000, a number the agency said was largely because of legitimate applicants and robust demand for the visa.

“All evidence suggests that this phenomenon of employers working together to overcome the odds has essentially disappeared,” the spokesman said.

The Bay Area Council's most up-to-date research found that almost 60,000 foreign nationals were approved to work for Bay Area firms under H-1B in 2019. The firms targeted for fraud charges weren’t named, so it stays unclear whether any are positioned within the Bay Area.

In Silicon Valley, expert immigration is driving world-leading innovation, said Peter Leroe-Muñoz, senior vp of technology and innovation on the Silicon Valley Leadership Group, which advocates for increasing the annual H-1B cap and whose members include the belong to the region's technology giants. “Silicon Valley companies are competing globally to attract and retain talent,” Leroe-Muñoz said. “H-1B visas are essential to maintaining U.S. leadership in technologies such as AI, quantum computing, autonomous vehicles and semiconductors. All of these technologies rely on the influx of global talent.”

Claims that American employees on the H-1B are losing their jobs and opportunities to foreign residents have made the visa a flashpoint within the country's immigration debate.

Ron Hira, a Howard University professor who studies visas, called the federal government's apparent success in combating application fraud “small potatoes” and said federal officials must do more because oversight is lax.

“Employers systematically steal the wages of H-1B workers, provide them with poor working conditions, and widely use the program to replace U.S. workers and move their jobs overseas,” Hira said, adding that several Cases have come to light by which US employees trained their H-1B employees -1B replacements, including on the University of California.

Many IT staffing firms violate H-1B rules by obtaining employees' visas though they don’t have any clients for them and keeping them waiting abroad, Hira alleged.

“This type of fraud is much larger and more damaging,” said Hira, co-author of the Economic Policy Institute report.

Selecting visa recipients by lottery favors outsourcing firms and must be replaced by a system that awards visas based on the very best salary, Hira argued.

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