Last week, a crackdown by American investigating agencies on two IT staffing companies running “bench-and-switch” scheme led to the arrest of four Indian-Americans. The scheme is used to manipulate the process of acquiring an H-1B visa. According to the US Justice Department, the four face a maximum potential penalty of five years in prison and a $250,000 fine.
The H-1B visa
The H-1B is a visa category that lets US employers recruit skilled foreign nationals in “specialty occupations” where there is a lack of American workers. According to the US Code of Federal Regulation, such occupations require “theoretical and practical application of a highly specialised body of knowledge and attainment of a bachelor’s or higher degree in a specific specialty as a minimum for entry into the occupation.”
Since such jobs are meant to be temporarily assignments, getting the H-1B requires going through a lengthy process.
A prospective employer first has to submit a Labor Condition Application (LCA) for Nonimmigrant Workers to the Department of Labor. Next, if the LCA is approved, the employer proceeds to submit Form I-129 to the Department of Homeland Security. Finally, if the United States Citizenship and Immigration Services approves the application at that stage, the H-1B visa is granted.
This prolonged procedure often takes several months until potential employees can know for sure whether their application has been favourably processed.
Legitimate hiring agencies specialising in H-1B workers help connect employers with prospective employees, and typically take a part of the worker’s salary for a period of time as well as charge a service fee.
The bench-and-switch scam
The scheme has been used by staffing companies in order to cut back on waiting time and to score an unfair advantage in getting the H-1B visa. The IT sector, which has a greater demand for persons with specialised skills, is especially fraught by this scam.
A staffing agency engaging in this practice makes H-1B applications for its foreign worker clients without first securing jobs for them. The agency creates fake data about its clients to defraud the various authorities in the visa process. At face value, submitted documents such as false service contracts, statements of work, and employment-verification letters lead the authorities to believe that such a “specialty occupation” exists and that the applicant has already secured employment.
Thus, by manipulating the process, a “bench” of fraudulently authorised foreign workers is created. These can be “switched” to actual employers when they are in need, without them actually going through the time-consuming process ridden with formalities.
The Trump administration, while increasing the rate of rejection even for genuine H-1B applications, has also taken a tough stance on combating visa fraud and illegal migration.
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