Rethinking H-1B visas

Senators Lindsey Graham and Charles Schumer have reportedly struck an immigration deal that involves doubling the number of H-1B visas.Associated Press file

The good news is that Republicans and Democrats finally agree on something. The bad news is that it’s the wrong thing: Republican Senator Lindsey Graham of South Carolina and Democratic Senator Chuck Schumer of New York, two of the so-called “gang of eight” that has been working on comprehensive immigration reform, told the Sunday talk shows that they struck a deal. It reportedly includes doubling the number of H-1B visas, which allow foreigners to work in the United States for companies that say they can’t find enough qualified Americans to hire.

Supporters say the high-tech industry needs more highly skilled workers, and that the current cap for for-profit corporations — 85,000 a year nationwide — isn't high enough.

But in reality, a significant number of those visas are wasted on jobs that don't really exist. All that exists is a desire to exploit cheap overseas workers.

Take the case of Dibon Solutions, a technology consulting company in Texas, whose executives were arrested last month for visa fraud. According to the indictment, Dibon brought workers from India with promises of good jobs, but then leased them out to other companies, and only paid them an hourly wage for the times they worked.

"The conspirators earned a substantial profit margin when a consultant was assigned to a project and incurred few costs when a worker was without billable work," it read.

The practice, known as "benching," is illegal but widespread.

The unemployment rate of H-1B visa holders should be zero, since there is supposed to be a job waiting for workers when they arrive, and they are supposed to leave the country if they get fired. But due to "benching," online forums are full of H-1B visa holders desperately searching for work. Some even ask if they are eligible for unemployment benefits.

"I am still on bench with my employer," one worker wrote into an online discussion forum three months after he arrived in the United States. "I have never got paid. Now my employer has suddenly asked me to . . . leave USA because I don't have any project/job."

Last Friday — just two weeks after Silicon Valley businessmen traveled to Washington to lobby for more H-1B visas — Silicon Valley businessman Balarkishan Patwardhan was arrested for "benching." He had asked to bring 19 computer systems analysts and computer programmers, at salaries of between $53,000 and $90,000 a year. But, according to the indictment, those jobs do not exist.

Sometimes H-1B abuse crosses the line into human trafficking. Nurses in the Philippines paid a Colorado man named Kizzy Kalu more than $4,000 apiece for the chance to come to the United States and teach nursing at Adams University, which doesn't actually exist. They ended up working at nursing homes for half the promised wages, and were threatened with deportation when they complained.

Then there is the case of Nilesh Dasondi, CEO of a New Jersey software company called Cygate, who brought six tech workers from India on the promise of high-paying jobs. Once they got here, he told them to hit the streets and look for work elsewhere. But he also charged them to stay on Cygate's payroll, so they could legally remain in the United States. Over the three years, the six of them paid him $504,000.

You might think these abuses must be rare. But evidence shows they are not rare enough: A 2008 internal study by the US Citizenship and Immigration Services estimated that 13 percent of H-1B visas involved outright fraud, and an additional 7 percent involved technical violations like underpaying an employee.

In some cases, the business did not exist. In other cases, the job didn't exist. One employer asked permission to hire a "business development analyst" but later admitted that the job was "working in a laundromat doing laundry and maintaining washing machines," the study said.

In some professions — life sciences, for instance — the rate of fraud/violations was zero. That suggests the need for H-1Bs is real. But in the computer industry, it was 27 percent. For accounting and sales, it was even higher: 42 percent. USCIS spokesman William Wright said the agency has stepped up site visits and fraud has gone down. But the agency hasn't done a comparable study since.

So before increasing H-1Bs, why don't we clean up the system first? If crooks stopped getting these visas, there might be enough for companies that legitimately need them.