
Bay Area professionals indicted for H-1B visa fraud - prostoalex
http://www.mercurynews.com/2017/03/25/bay-area-tech-executives-indicted-for-h-1b-visa-fraud/
======
FesterCluck
I've personally witnessed the hiring of a contractor from India at a small
development company simply to save on funds. There were plenty of skilled
workers in our pool to fill the position, the owner simply didn't want to pay
the price.

Weeks into his employment the developer came to me and asked if there was
anyone he could report work complaints to. I gave him contact information for
the state's employment agency. It took another week before I realized that he
needed to be informed that the state agency protects him whether he's a
citizen or not, and that he wasn't trying to report a former employer.

I know many talented people who have come to the US on H-1B clean and have
been successful. I, too, do not blame the workers. The employers are abusing
the system, and if it continues there must be much stricter oversight.

~~~
izacus
That sounds like free market though doesn't it? Hire the cheapest workforce
that can do what you want?

~~~
klodolph
Maybe it's the "selectively free market". Free when it makes things convenient
for me (I can hire cheap labor), not free when it makes things inconvenient (I
don't compete against cheap labor or other business which might be more
competitive here if they could hire the same cheap labor).

~~~
izacus
Or maybe "we want fully free market for whatever we produce but not for when
someone competes for my job"? :)

HN comments usually skew hugely against any kind of regulation and towards
"free market will take care of it", except when it comes to jobs and pay it
seems.

~~~
klodolph
Yes, that's a good way of putting it. Free market is often a layer of rhetoric
on top of arguments for whatever deregulation makes you the most money.

------
Velox
This thread is great. Whenever H-1B threads come up on HN, I prepare for the
onslaught of what can only be described as hatred. It's the view of many
people on this site that all H-1B holders are "cheaters" of the system, and
they don't deserve to get a job in the US. As a former H-1B holder, the
threads always made me feel guilty, and feel bad about wanting to work for a
well regarded, successful company. It's nice, and refreshing, to see that it's
not the view of everyone, and that H-1B holders are equals and deserve the
same rights as everyone else.

~~~
Amezarak
I don't think I, or most other people who are against the H1B visa system,
have anything against H-1B holders themselves. They're obviously everyday
people who are doing what's right for themselves and taking a big risk that
generally pays off pretty well for them. If I was in their place, I hope I
would have the cojones to do the same thing. Picking up and moving to another
country is a big deal.

What I have a problem with is the companies who employ them. The _intent_ of
the H1-B visa is for companies to be able to hire workers with skills they
can't hire for in America. The reality is that 99% of H1-B programmers are
hired because they're cheaper or some other anti-labor reason. There is not a
shortage of programmers in the US - I'll grant there could be in Silicon
Valley or California - these companies are not looking very hard for
programmers, and they're more willing to get someone from a foreign country
than pay for relocation for someone from say, Iowa, or to open an office
there. So, frankly, I see virtually every tech company hiring H1-Bs as
committing immigration fraud in order to screw over people like me.

[https://en.wikipedia.org/wiki/H1b#No_labor_shortages](https://en.wikipedia.org/wiki/H1b#No_labor_shortages)
\- basically sums it up.

Unlike other people in this thread, I don't give a fig for free markets,
except to the extent they make people's lives better, which they do have a
decent track record of doing in many instances. Since I live in America and
only the US government has direct power over the lives of Americans, I judge
US government policy by that criteria. It seems clear to me a global free
market for labor is the worst thing imaginable for Americans in the short
term, and the world population in the very long run. Free immigration is a
handout to corporations, who want to expand the labor pool as much as possible
so they can play us all off against each other on a grand scale. It disgusts
me enough to watch corporations and businesses play off state and national
governments against each other for tax incentives and subsidies. I'm not
interested in programming being a minimum-wage job or living under any more of
a global techno-corporate system than I already do.

~~~
humanrebar
> I'll grant there could be in Silicon Valley or California

I'd be willing to relocate there if it made economic sense. If H1B were not
available and bay area salaries higher, it would be more in the realm of
personality.

I know a lot of great engineers in "flyover states" that more than understand
that they'd have to take a decrease in standard of living to move to the Bay
Area so don't even consider it.

~~~
Merad
> I know a lot of great engineers in "flyover states" that more than
> understand that they'd have to take a decrease in standard of living to move
> to the Bay Area so don't even consider it.

Yup. According to all the cost of living calculators I'd need upwards of $175k
in SF to match what I'm getting at the moment in boring old Tennessee. There's
no way it's worth it for me.

~~~
humanrebar
...and in my experience, those cost of living calculators underestimate how
much nicer (and more commutable) homes are in lower cost of living areas.

~~~
seanmcdirmid
They also over estimate how much non housing expenses are in places like SF.
Food is often cheaper in those cities, not more expensive, and most non
service items cost almost the same.

It's a wash.

------
ComodoHacker
I wonder why people here praise free competition on a global market as a
primary value when they talk about their products and services, but support
competition limiting when it comes to the labor market in their own country.

~~~
mvpu
It's not about competition limiting, it's about unfair pricing and abuse. It's
not fair to replace a local worker with a foreign worker _because they 're
cheaper_. And, there are tons and tons of staffing firms who systematically
abuse the H1B program - they funnel workers from different countries
(especially India), often mistreat them / threaten them / underpay them.

~~~
witty_username
> It's not fair to replace a local worker with a foreign worker because
> they're cheaper.

It's as fair as buying something for cheaper when you can.

In fact, it's probably more fair as globalization lifts foreign workers out of
poverty.

A richer local worker loses while a poorer foreign worker wins and the U.S.
overall wins.

~~~
mattmanser
Is it really fair?

That rich people benefit from the laws and protections of the U.S., without
having to deal with the corruption and laws of India. But they can then import
cheap workers to displace the very people who paid for those protections to
even exist in the first place?

It seems a breakdown of the social contract to me.

I think there's definitely two ways to look at this one.

~~~
witty_username
> That rich people benefit from the laws and protections of the U.S., without
> having to deal with the corruption and laws of India. But they can then
> import cheap workers to displace the very people who paid for those
> protections to even exist in the first place?

If the tax system is so broken that the poorer are paying for the richer's
protection, then fix the tax system so that the rich person pays the
"correct/fair" amount. For example, remove most of the deductions and other
rules and replace it with a simple flat tax.

Anyways, why are you saying "rich people"? Ordinary people own these companies
and purchase from these companies. They benefit.

~~~
mattmanser
You entirely missed my point and reduced it down to simple, naive, economics
again. How depressing.

This isn't about tax rates, it's about a social contract, a small few are
allowed to capture a significant % of the economic output of a country, to
reap the benefits of the legal and military power of that country. As part of
that, they need to share, and they're sharing increasingly less. They think it
their "skill" rather than their lucky upbringing, their fortunate birthplace.

There's far more to life, and to a country, than GDP.

As for ordinary people "owning" companies, that's either a naive or
disingenuous argument. They're a tiny percentage. It is widely acknowledged
the benefits of economic recovery has almost entirely been captured by rich
people and ordinary people haven't seen an effective wage increase in a
decade.

The stats don't back your stance.

~~~
witty_username
> You entirely missed my point and reduced it down to simple, naive, economics
> again. How depressing.

Of course it's about economics as it deals with policy and impacts on people.
Simple arguments are better.

Not using economics is a cop-out from using rigorous quantitative analysis.
It's interesting that on say climate change HN will be all like we should
follow the science, yet economics is the science relevant to our discussion.

> There's far more to life, and to a country, than GDP.

True, so what? More money is still better. GDP per capita is a good measure of
peoples' living standards.

An interesting read about "The Economics of Happiness" is
[https://www.federalreserve.gov/newsevents/speech/bernanke201...](https://www.federalreserve.gov/newsevents/speech/bernanke20100508a.htm)
by Ben S. Bernanke, former chair of the Federal Reserve (the part starting
from "As you might guess, when thinking about the sources of psychological
well-being" is most relevant).

[https://www.gapminder.org/news/hdi-surprisingly-similar-
to-g...](https://www.gapminder.org/news/hdi-surprisingly-similar-to-
gdpcapita/)

> As for ordinary people "owning" companies, that's either a naive or
> disingenuous argument.

The stats don't back your stance. "Compare that to the middle class, which has
a median value of a mere $14,000 a household."

Also, bond yields (and bank interest) go up when stock yields go up and (I
don't know if CNN counted this or not) people invest in retirement funds which
invest in stock. And insurance companies also invest their customers' money.

([http://money.cnn.com/2014/09/18/investing/stock-market-
inves...](http://money.cnn.com/2014/09/18/investing/stock-market-investors-
get-rich/?iid=EL) )

[http://www.valuewalk.com/2013/03/retail-investors-
hold-38-of...](http://www.valuewalk.com/2013/03/retail-investors-hold-38-of-
us-equities/)

"A surprising fact revealed in the report is that retail investors have
invested $9.8 trillion in the U.S. equities, or 38 percent of the total $25.8
trillion corporate equity holdings. Additionally, $812 billion hedge fund
assets belong to US retail investors. To put in context hedge funds have total
assets under management of approximately $2 trillion. This would mean that
approximately 40% of hedge fund assets come from retail investors in the US,
the remainder comes from foreign investors and institutions."

> They're a tiny percentage. It is widely acknowledged the benefits of
> economic recovery has almost entirely been captured by rich people and
> ordinary people haven't seen an effective wage increase in a decade.

The stats don't back your stance.

[https://en.wikipedia.org/wiki/File:U.S._Income_Share_of_Top_...](https://en.wikipedia.org/wiki/File:U.S._Income_Share_of_Top_1%25_of_Households_CBO_%26_P-
S_1979-2011.png) here, rejoice that the top 1%'s share is mostly static

Meanwhile,

[https://fred.stlouisfed.org/series/MEHOINUSA672N](https://fred.stlouisfed.org/series/MEHOINUSA672N)
it's increased by 7.3% from 2012-2015

Interestingly, you said "The stats don't back your stance." while not using
any stats yourself and only using weasel words like "It is widely acknowledged
the benefits of economic recovery".

~~~
mattmanser
Oh, stop. It's widely reported in the news, you can't have missed it, e.g:

[https://www.theguardian.com/business/2014/nov/13/us-
wealth-i...](https://www.theguardian.com/business/2014/nov/13/us-wealth-
inequality-top-01-worth-as-much-as-the-bottom-90)

Graph looks severely different to the one you just posted.

I'm not going to try and debate anything with someone who thinks economics is
the only measure of life, you're too narrow minded.

~~~
witty_username
The graph is different as it shows the wealth share, not the income share.

> I'm not going to try and debate anything with someone who thinks economics
> is the only measure of life, you're too narrow minded.

I don't think money is the only measure of life. Then what do you want to use
to measure it?

------
virtuabhi
In the threads where we discuss H1B visa holders taking American jobs, can we
also consider that American companies are selling their products in countries
from where H1B workers come from?

Google's Android biggest growth region is India. Why shouldn't then Indians
work in Google? Maybe Google should move its headquarters from MV to
Bangalore. Alphabet can remain in US.

Or another US company, lets say Pepsi, outsources its IT work to an Indian
company, Infosys. And everyone in India is drinking Pepsi. Why is it wrong
that IT work in Pepsi is done by Infosys? Should India ban Pepsi because Pepsi
Inc. has more non-Indians than Indians?

I am not surprised that EU is actively fining US companies like Google and
Apple, and China does not allow US companies in the first place. And if
xenophobic and protectionist polices continue in US, then I am afraid that
countries like India will have to do the same like EU or China.

~~~
eanzenberg
That's fine, have them open an office in India and hire locally. Ever wonder
why they don't on a massive scale?

~~~
dboreham
They do. One of the justifications for the H-1B and similar programs is that
it benefits the US economy by having work that could have been performed
overseas, done domestically, and moves the associated smart, high taxpaying
people inside the country.

------
pm90
From the article:

> The indictment charges that from 2010 to 2016, Dynasoft petitioned to place
> workers at Stanford University, Cisco and Brocade, but the employers had no
> intention of receiving the foreign workers named on the applications.

Should be noted that this is only the most brazen, harebrained scheme that has
been uncovered and is being convicted. Not that its not important; but it may
be more useful overall to go after the Big Co's that are doing everything
_technically_ legally but are still using H1B in ways it was not meant to be
used.

Edit: Also just realized, when you say "Bay Area Tech Executives" it almost
sounds like you're talking about Larry Page; but these "executives" were only
officers of a shell company (seemingly) meant exclusively for committing visa
fraud.

~~~
skrebbel
> Edit: Also just realized, when you say "Bay Area Tech Executives" it almost
> sounds like you're talking about Larry Page

I'm sure that was the author's intention.

------
throw2bit
I am on H1B, but my job in US is being threatened by fake H1Bs from India who
are willing to work on salaries lesser than mine, particularly from the state
called Andhra Pradesh in India. There are many one room consultancies all over
the US which runs fake payrolls and even apply something called "Future
Greencards" for people who are willing to pay money. These Andhra
consultancies can be found in abundance in New Jersey, Edison, and on West
coast. There is even a temple in Andhra Pradesh where you can go and pray to
get selected in H1B.

Even though I was a legitimate H1B worker, when the rules become strict to
counter these fake H1Bs, I might also get affected, so I moved to Canada with
Express Entry, which is based on skills.

Fake H1Bs cannot fake IELTS exam and Canada does thorough verification and
police clearances. So that its Express Entry system is not abused like H1B
system of US.

~~~
zerr
But 6-figure salaries are quite rare in Canada (for engineers).

~~~
effingwewt
Cost of living is cheaper, and what does losing a couple thousand a year
matter compared to job and housing security?

------
deepnotderp
It's annoying that SV tech companies get a bad rap with the H-1B even though
that the real people abusing these visas are clearly outsourcing firms like
Tata and Infosys.

~~~
yummyfajitas
It's not Tata and Infosys either. Those guys are too big to avoid playing more
or less by the rules.

The actual people playing games like this are small time bodyshops. It'll be
two cousins from Ahmedebad starting a shop in the US and hiring a bunch of
locals via their personal network. They then attempt to socially isolate their
employees, getting them set up in the local Guju community, so they don't talk
to outsiders and discover their true market worth.

~~~
WalterBright
I'm not sure how anyone could be prevented from using google to research how
much they are worth.

Edit: To clarify, I am commenting on the parent's remark that employers are
preventing employees from finding this out.

~~~
patio11
Would you believe that I took a $30k a year programming job as a legal
immigrant in the knowledge that it would require 60+ hour weeks because it was
my impression that it was the best option available to me?

"I'm clearly not Google material; I can barely get this J2EE app working", "I
perceive that I am working uphill against racism in hiring managers", "I owe
my sponsor for this job because they treated me fairly", "Literally no one in
my friend group or family has a better job than this at my age", "I suppose
this is what 'paying my dues' means and I have been aggressively cultivated to
do so since before I could read", "My BATNA is deportation", "Well they are
offering a 50% premium on a grad student stipend", etc, can do an awful lot of
work.

~~~
umanwizard
Was this in Japan? (I just read the first few sentences of the bio on your
blog). If so, how different is 30k USD there from market rates? And what
country are you from originally?

I wonder if anything is at all different because of differences between
Japanese and US culture with respect to discussing compensation, what is
typically expected of workers, and so on.

(Not trying to poke holes in your story -- just genuinely curious!)

~~~
patio11
This was in Japan. I'm from the US. It's market for a 25 year old in Nagoya,
but the point is that despite the fact that there were really straightforward
ways to get triple that I in fact did not.

------
throw2bit
Another typical scheme - There are many Indian IT managers who got GreenCard
around the Y2K rush. Now they are settled US citizens working in big
corporation's IT depts. They setup these one room consultancies as a side
business and because of their strong ties to India, they source unskilled
graduates from India thru fraudulent H1B satellite "offices" in India (many
fraudulent satellite H1B offices are there in Bangalore & Hyderabad in India),
since H1B is a lottery, no scrutiny of candidate's skills are done by USCIS.
They take the applicant's "word" for it.

Now when the big corporations have IT openings, these managers wont publish
the openings in job portals. They recruits these H1Bs from their own
consultancies with a high billing rate, indirectly making profits. They also
take a cut from the H1Bs salary on a monthly basis as a "fees" for brining
H1Bs to US.

------
writer77
Beyond this, there's an entire system that has undermined American software
engineers. Schools are incentivized by the ridiculous out of state/country
fees they get when they accept international students for their Masters
programs, regardless of a students actual abilities or whether the three year
Indian/China/U.K. Bachelors sufficiently prepares them. These people always
graduate, because money. Corporations, who love hiring people who can't leave
them for another employer then gobble them up legally by requiring a masters
degree in job description. And once they gain a big enough foothold in a
company, the Good Ole Boy Club effect happens and they mostly hire their own.

~~~
silentguy
In a way overseas students subsidize the education of local american students
in exchange of access of job market. It seems like a fair deal to me.

~~~
johnnyb9
Just because they pay full tuition doesn't mean domestic students pay less. If
anything they are subsidizing the salaries of the people working at the
universities.

~~~
dvnguyen
Domestic students do pay less. Usually out of state students pay twice what in
state ones do.

------
NetStrikeForce
The problem with H1-B's is what in Spain we call "ni chicha ni limoná" \-
which means that it is something half-baked or half-way from being A or B.

H1-B seems to increase competition among workers, but in fact it does not,
because H1-B workers are captive workers. They don't enjoy the same rights as
their local counterparts. They can't leave the company and start applying for
other jobs.

This leads to abuse from businesses.

~~~
sulam
They certainly can apply for other jobs! True they can't quit and then look
for work. I know some people do that, but most don't. The ones that do are
usually very senior with good savings, so they can afford to take a few months
off while they do their job search. Regular schmoes take a sick day to go
interview.

~~~
NetStrikeForce
Thanks for clarifying, I reckon my comment was probably not clear enough.

------
umbs
I don't think the H1-B abuse is straightforward. IMO, many institutions
(private and government) are deeply entangled in this.

1\. There are many poor universities promising MS degrees in CS (here in
California, there's Silicon Valley University, ITU etc). Not casting
aspersions, but I doubt the quality of education from them.

2\. Students can't get funding/scholarship. They tend to do odd jobs to make
ends meet (many are illegal as students can't work outside of campus). They
get in to severe debt.

3\. Once they get a degree, clock is ticking to get a H1B. Note that recent
OPT extensions give them breathing time. But nonetheless, they must get H1B to
stay in country.

4\. This is where one room consultancies come in to picture. They sponsor H1B
and legally allow staying in US.

5\. Students start working at lower end of pay spectrum. A friend of mine is
willing to work for $20 - $25/hour (after commissions to consultancies) even
after 10+ years of experience. The friend is in web application testing.

6\. Sticking with consulting firms, it takes long time to break the "low
income" cycle as projects are short lived, pay is low and job insecurity is
high.

So, #3 and #4 are serving each other. Private universities gets income from
students. US consulates in Asia give visas with, probably, tax dollars in
mind. I even suspect private universities have some sort of lobbying that
allow students from Asian (or other) countries to come for education.

So, my point is, this H1-B visa thing is quite deep and goes way back to
universities and students coming for education.

------
anjc
Every time a thread comes up on whether H-1B visa fraud exists there a cohort
of posters who maintain that they've never seen it and that people who say
that it happens are just racist and xenophobic.

Remember this thread, and ones like it.

~~~
bobosha
Actually a significant number are little more than knee-jerk racism with "all
'em jerbs are belong to me" attitude. Ohh and anecdotes galore how horrible
h1bs are, and how an american white knight had to come save the day. Remember
this too.

~~~
anjc
I don't have to remember it, it's the stock response dished out to people
who've actually been affected by it and have seen it first hand.

------
mavelikara
Delighted to see more of these parasites getting indicted. Here they are
plotting to keep more of their employees enslaved in long GC backlogs
[https://youtu.be/lj1bHpPvSuE](https://youtu.be/lj1bHpPvSuE)

------
hrshtr
In bay area there are quite a handful of such firms which fake person resume
and help them find out the job. What surprises me is that employer does catch
the difference in experience while interviewing and bunch of positions are
filled. These firms file h1b shown more experience than what a person does
actually have and make good money out of such schemes :(

~~~
callalex
Please rephrase your comment in complete, comprehensible English sentences.

~~~
thaumasiotes
"In the bay area there are quite a handful of such firms which fake a person's
resume and help them get a job. What surprises me is that the employer does
catch the difference in experience while interviewing and a bunch of positions
are filled (anyway?). These firms file h1b applications showing more
experience than the person actually has and make good money out of such
schemes :("

It seemed mostly comprehensible to begin with. I think a discussion of
immigrant visas is actually a really poor place to insist on only hearing from
people who speak perfect english.

------
org3432
Other than anecdotal stories, are there stats from a reputable source on how
widespread this is and what the real impact is?

------
thinkcomp
The case docket is here:

[https://www.plainsite.org/dockets/34ncju6ac/california-
north...](https://www.plainsite.org/dockets/34ncju6ac/california-northern-
district-court/usa-v-murugan-et-al/)

------
faragon
Is there any study analyzing performance between H-1B tech workers and remote
tech workers? (i.e. how being in the same building or working in different
time zone affects planning and performance)

------
s0me0ne
Now if we could get companies on intern fraud that would be great. Interns are
not legally supposed to take jobs from real workers, be unpaid (unless you are
a non-profit), or be used for real work right away (like things that might be
used 9 months from now possibly). But their main purpose is to teach them, not
to be used for cheap/free labor.

------
diogenescynic
They also need to start going after the lawyers at the immigration firms who
knowingly assist in fraud and even coach the applicants how to respond to
USCIS questions. There is rampant fraud going on. I've seen it firsthand and
know dozens of others in the industry who have as well.

~~~
mavelikara
They have started doing just that. From [1]:

    
    
      An immigration attorney for two information technology companies today
      admitted that she submitted phony documents and obstructed a federal 
      investigation as part of a scheme that fraudulently obtained foreign 
      worker visas, U.S. Attorney Paul J. Fishman announced.     
    
      Sunila Dutt, 39, of Ashburn, Virginia, pleaded guilty before U.S. 
      District Judge Kevin McNulty in Newark federal court to an information 
      charging her with conspiracy to commit visa fraud and obstruct justice.
    

Like you said, they need to do more of those though.

[1]: [https://www.justice.gov/usao-nj/pr/virginia-immigration-
atto...](https://www.justice.gov/usao-nj/pr/virginia-immigration-attorney-
admits-visa-fraud-obstruction-justice)

------
caltrain
Unrelated: Elon Musk was on H-1B before Paypal days.

------
bobosha
I know what you are going to say: "There are plenty of IT jobs, just not
enough at the salaries, us american programmers feel entitled to"

------
known
It's even worse [https://qz.com/889524](https://qz.com/889524)

------
rattray
The title is a bit sensationalist and misleading; "Bay Area staffing executive
indicted for H-1B visa fraud" would be more accurate.

One of the two people indicted is the CEO of a staffing company ("Dynasoft
Synergy" in Fremont); the other has worked at a couple companies including
Cisco, not explicitly in an executive capacity.

~~~
dang
Thanks. We've changed the title to make it less misleading.

------
tsunamifury
Auto plays an ad at full volume. -- closed.

~~~
FesterCluck
Since I consider the content an important read, here's a text-only google
cache link:
[http://webcache.googleusercontent.com/search?q=cache:http://...](http://webcache.googleusercontent.com/search?q=cache:http://www.mercurynews.com/2017/03/25/bay-
area-tech-executives-indicted-for-h-1b-visa-fraud/&num=1&strip=1&vwsrc=0)

------
elastic_church
The charge alone will deter alottttt

If you think rumors spread fast in the states, wait till you see asymmetric
information spread through India

------
LeicaLatte
click.bait()

------
notliketherest
"Dynasoft Synergys" did anyone else LOL

~~~
Neliquat
Buzzword bucket naming strikes again...

------
Animats
This is progress. Give a copy of this to your employer if they start talking
about replacing you with an H1-B.

~~~
chrisper
This makes no sense. If you are getting replaced then it's through an
outsourcing company. Your employer wouldn't even be doing the fraud. It's the
outsourcing company.

~~~
TuringNYC
In many cases, the employers are _also_ engaging in tangential fraud. A common
situation is for employers to post impossible experience requirements at an
impossibly low salaries...obviously no qualified candidates come through...and
then claim they searched domestically unsuccessfully. The kicker is that the
H1 resource often then hired lacks most of the impossible requirements.

The H1 system is completely gamed by both outsources and employers with
legions of people at both places gaming the paperwork. It really needs a total
overhaul.

I'm not against foreign workers, but we should be getting the best foreign
workers, not just the cheapest ones we can find. A good system might be a
reverse auction system where H1s are allotted first to the highest offer and
goes down until allotments are filled. Then, perhaps employers would consider
all the local graduates and reserve H1 spots for exceptional talent we need
from overseas.

