Lawsuit Exposes Deep Corruption in H-1B Job Outsourcing Program

Neil MunroNovember 23, 2021

The Department of Homeland Security (DHS) is holding a third lottery for H-1B visas this year after U.S.-based Indian managers corruptly sold multiple tickets to fellow Indians, according to a lawsuit by Asian job seekers.

“There is literally no [DHS] follow up to fake filings that we can ascertain, and no effort is made by [DHS to] weed out folks who have filed multiple applications with multiple employers,” said Charles Kuck, an Atlanta lawyer who helped file the lawsuit.

“This is a giant loophole and one which is clearly subject to manipulation at the expense of legitimate applicants,” including his Asian clients, he told Breitbart News.

A November 22 legal filing said the agency:

…selects different registrations during each round of selection, but keeps selecting [duplicative applications from] the same individuals. This, in turn, leads to the need for [DHS] to conduct supplemental rounds of selections in order to meet the annual [85,000] limitations.

The third lottery was announced on November 19 by DHS’s U.S. Citizenship and Immigration Services (USCIS) agency.

The fraud is being conducted by U.S.-based Indian companies who work with Indian graduates to bundle multiple fraudulent visa applications into the job lottery, according to the June lawsuit by hundreds of Asians who are also trying to get U.S. college-graduate jobs and valuable green cards vis the H-B outsourcing program.

“Brazenly, these entities advertised all over social media and H-1B forums on the internet, pitching to prospective H-1B applicants that the odds would be in their favor with multiple registrations,” the lawsuit said. It continued:

For example, one entity, which calls itself “Fluxtek Solutions,” advertised that they “will place you on H-1 lottery from multiple companies so that the probability of picking cap process is high.” … Fluxtek Solutions was also promising its customers “100% job Guaranteed with H1B Visa Sponsorship.”

Fluxtek did not respond to a call from Breitbart News.

DHS chief Alejandro Mayorkas suggested November 4 he would rewrite some of the rules for the H-1B Program.

I find some of the highest skilled processes to be in dire need of re-engineering. The random lottery [for H-1B visas] to me is not an optimal way of serving the market needs. And … we’ve got to do a really good job of developing homegrown high skilled talent.

Nearly all of the visa reforms that were slowly imposed by President Donald Trump have been reversed by Mayorkas and his allies. But Mayorkas is defending a Trump rule that would allocate new H-1B visas to companies that offer the highest pay.

The H-1B and other visa programs allow Fortune 500 companies and their subcontractors to import low-wage, mid-skill foreign professionals use in a very wide variety of jobs needed by American graduates, including in science, Silicon Valley, journalism, fashion, and healthcare.

Many U.S. journalists help to hide this wealth transfer from their own families, peers, and relatives by focusing their emotions on the preferences of migrants. Also, most — but not all — U.S. professionals are cowed by the establishment’s claim that they must live in a “Nation of Immigrants.”

Unprecedented third H1B lottery is big news in India.

As usual, not a peep from the U.S. media, which would rather distract us with show trials while our jobs are quietly taken away. pic.twitter.com/EH9SGcNLPW

— White-Collar Workers of America (@WCWOA) November 21, 2021

H-1B advocates say the program annually imports 85,000 high-wage, high-skill workers for jobs that no Americans can do. “The reality is that the H-1B CAN and SHOULD be an effective visa …. There are clearly folks we want and need here,” said Kuck.

The lawsuit describes how corrupt Indian managers sell multiple tickets to their fellow Indian nationals, regardless of skills or shortages:

phony companies created a pay-to-play scheme where they charge individuals to submit multiple registrations on their behalf. See Exhibit. A (compilation of advertisements promoting H-1B abuse). For example, one individual selected in this year’s lottery reported that the consultancy he used for H-1B registration purposes was seeking $4,500 from him in order to submit an H-1B petition on his behalf.

But these phony companies are part of a large ecosystem of Indian-run companies through the United States, the lawsuit notes:

These entities and individuals who use their services are a part of much larger network of H-1B abusers which has existed for years. For example, this year, a Houston based company called Cloudgen LLC pleaded guilty to conspiracy to commit visa fraud from about March 2013 to December 2020. During the plea, the company admitted to recruiting multiple information technology workers from India and falsely procuring H-1B visas for them to enter and work in the United States. Once the workers were inside the United States in H-1B status, Cloudgen LLC would funnel the workers to different employers based on [new contracts and] market demand.

The lawsuit corroborates statements made to Breitbart by many imported workers and U.S. professionals:

“I have seen the system in the backend, and it is so appalling to see that there is so much [resume] forgery being done, there’s so much of corruption being done, that it is almost to the level back in India,” said Aabha, an Indian in North Carolina. Aabha continued:

I have met so many [American] people who are graduates and so much more knowledgeable than the Indians that I see in my regular [work]day — and they are [saying] like “Okay, because we are not experienced, we are not getting [technology] jobs.” So they decide to do a blue collar job. They’re walking into Walmart, they’re walking into Best Buy. And these Indians, the team that I work with, they cannot even speak a single sentence in English without making any mistakes.

Indian-run subcontractors and visa workers can forge resumes and technical credentials because U.S. employers “do not really do background verification unless and until they hire you as a full-time employee,” Aabha said, adding:

Just in case the [U.S.] employers need to check, the [Indian subcontractors] create one small office in India, they take a rental apartment in India, they put poor people there, they [instruct them to say] “If you get any calls, tell them that this person has experience.” That it. It’s as simple as that.

Indian managers also duplicate the DHS’s H-1B visas to import additional, kickback-paying Indian workers, Aabha said:

They have been doing it openly and it’s all Indians, only Indians, because they are so desperate to move to the states. They’re so desperate to leave their country because they know they cannot work there. They know that they’re not going make so much money as they do here.

Once hired at U.S. wage rates, untrained Indian software workers pay qualified Indians in India to do the actual work on their U.S. computer at Indian wage rates, regardless of U.S. privacy and secrecy laws, Aabha said:

I’ve seen people working [for the] Bank of America [as] they take support from India. I’ve seen people working [for] Wells Fargo taking support from India …The person there in India will guide [them] via Zoom or by via video call and they will get the work done.

Many government reports, lawsuits, and articles say that India’s workplace culture is far more distrustful and grasping than Americans’ ideal of high-trust, dispassionate professionalism. Breitbart News has covered these developments here, here, here, here, and here.

But the imported Indian workplace culture is increasingly dominant in U.S. Fortune 500 companies, in part, because it matches the ruthless worldview of Wall Street investors, one U.S worker told Breitbart News. “The fact of the matter is, the people on Wall Street don’t care — they want the bottom line.”

Imported Indians “have influence in the entire [information technology] market in America,” Aabha said, adding:

Every position that is a manager position or at least senior president position in every company that I’ve interviewed, it’s an Indian. For sure it’s an Indian, and they do not take the people that are qualified now, they are taking people who they can get [faked] reference from and … get some sort of kickback from.

The H-1B outsourcing is managed by a huge number of little-known firms, many of whom consist of a website and an apartment in Texas or California. These immigrant-run companies use the visa programs to import fellow nationals from their home countries, and then trade them in blocs to the bigger subcontracting firms who provide outsourced services to slimmed-down Fortune 5r00 companies.

This labor pyramid works well for the few CEOs and investors at the top of the Fortune 500 companies, because it provides them with a low-cost, government-compensated, immobile, no-rights, white-collar workforce that can be hired and fired at will.

The foreign workers do accept low wages and abusive conditions because they are hoping to win the green cards from the government that will allow them and their extended families to migrate from India and China to the United States.

Moreover, this imported green card workforce means the investors and CEOs can minimize their reliance on outspoken American professionals. The immobile, no-rights foreign workers are preferred to Americans because they dare not testify in lawsuits, argue back to their managers, and usually cannot quit to join companies or create rival products.

The program also helps to flood the Americans’ labor market, so holding down wages for a wide range of American graduates, including graduates who do not face direct competition from imported H-1B workers.

This program also spikes the stock-market gains for investors and CEOs. For example, one study claims that President Donald Trump’s 2020 curbs on the H-1B program chopped $100 billion off the stock market values of Fortune 500 companies.

The process also generates much wealth for U.S. universities because foreign workers must pay for U.S. college degrees before they can ask for temporary work permits.

The H-1B program is just one part of the green card workforce. For example, many additional white-collar jobs are outsourced via the J-1, L-1, B-1/B-2, Optional Practical Training, and Curricular Practical Training programs. Overall, roughly 1 million white-collar jobs are held by foreign graduates, including many who overstay their expired work permits or duplicate the low-security work documents.

The blue-collar outsourcing is done by the H-2a, H-2B, EB-3, B-1/B-2, and E-2 programs.

The outsourcing has spread far from its 1990s origin in the tech sector. For example, many American nurses, pharmacists, and doctors are losing jobs, salaries, and careers to Fortune 500’s hidden green card workforce.

Federal officials perform token oversight of these visa programs. But CEOs and companies who exploit the gaps — such as Facebook — are given minimal penalties, and Biden’s deputies are rolling back Trump’s modest efforts to release information to the public. Major media outlets, including the corporate-owned TV networks and Jeff Bezos’ Washington Post, rarely display any information about the outsourcing, despite the huge economic damage.

But the middle-class outsourcing will be supercharged by President Joe Biden’s pending Build Back Better bill. Breitbart News reported October 27:

The Democrats’ $1.7 trillion spending bill expands hiring discrimination against Americans by rewarding CEOs who hire foreign graduates, say experts on migration law.

“This is structural discrimination that will remove any any leverage for Americans to get better wages or working conditions,” said Rob Law, the director of regulatory affairs and policy for the Center for Immigration Studies.

The bill allows CEOs to hire an uncapped population of foreign graduates with dangled offers of government-awarded, fast-track green cards.

It will be “inherently impossible [for U.S. graduates] to compete … the foreign workers will always accept less pay because they also get the incredibly lucrative benefit of permanency in the United States,” Law said. Many foreign graduates also have little college debt to pay off.

The widespread corruption in the unsupervised visa-worker programs blurs the much-touted distinction between legal immigration and illegal migration.

In reality, the federal government extracts foreign workers for use in Americans’ labor market by both legal and illegal routes.

This extraction migration policy brings in roughly 2 million people into the U.S. each year, so boosting the stock market.

But it also causes huge damage to Americans careers, wealth, and housing costs, to Americans’ innovation, security and politics — and often to the home countries.

Many polls show that labor migration is deeply unpopular because it damages ordinary Americans’ career opportunities, cuts their wages, and raises their rents. Migration also curbs Americans’ productivity, shrinks their political clout, widens regional wealth gaps, radicalizes their democratic, compromise-promoting civic culture, and allows elites to ignore despairing Americans at the bottom of society.