News/US: Visa program open to abuses

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Subject: News/US: Visa program open to abuses
From: Melanie Orhant (
Date: Wed Jan 26 2000 - 10:20:59 EST

Visa program open to abuses
By Alan T. Saracevic
San Francisco Examiner, January 23, 2000

An alleged tale of prostitution, illegal immigration and molestation in
Berkeley has reopened one of Silicon Valley's most contentious issues: the
use and abuse of temporary work visas.

The unlikely and unwanted attention stems from the highly publicized case
of Lakireddy Bali Reddy, the 62-year-old Berkeley landlord who stands
accused of smuggling young Indian girls into the United States for the
purpose of prostitution, among other charges.

The fact that an H-1B visa was allegedly used to get a man claiming to be
the girls' father into the country with them as his dependents has many
industry watchers taking a second look at the controversial program.

Created by the Immigration Act of 1990, H-1B visas have become a
politically charged issue in recent years. Silicon Valley companies,
claiming they can't find enough skilled workers in the United States, have
lobbied to increase the number of visas issued every year, enabling them to
recruit overseas. Opponents charge the technology industry with ignoring
qualified workers here at home.

The H-1B is a temporary visa category for non-immigrant workers that
includes specialty occupations requiring a bachelor's degree or higher. In
an odd quirk, it also applies to "fashion models of distinguished merit and

According to his arrest warrant affidavit, Reddy misused these visas,
bringing Indian nationals over to the United States under false pretenses.

There are at least 21 visa applications filed on behalf of Active Tech
Solutions, a software company owned by L. Vijay Kumar, a son of the
suspect, the affidavit said.

Telephone calls left by The Examiner at Active Tech were not returned.

The business has operated in Berkeley since last November with five
employees, according to the city of Berkeley's finance department.

The girls Reddy allegedly mistreated were also brought to the United States
under the H-1B umbrella, using the "H-4" visas given to close relatives of
H-1B recipients.

Typical H-1B occupations include architect, engineer, computer systems
analyst, accountant, physician and college professor.

Initially, the maximum period of admission is three years but the visa can
be updated annually after that initial period. An H-1B recipient may not
remain in the United States longer than six years.

Following a protracted political fight, the American Competitiveness and
Workforce Improvement Act of 1998 temporarily raised the number of H-1B
visas available annually from 65,000 to 115,000 for fiscal years 1999 and
2000, and 107,500 in fiscal year 2001.

The act also requires a new H-1B worker fee of $500 paid by U.S. employers.
The $500 fee funds training and education programs for U.S. workers.

The increase in visas was viewed as Silicon Valley's first major victory in
Washington, D.C., representing the burgeoning industry's growing muscle in
the nation's capitol. Opponents accused the government of ignoring its own
citizens in favor of big business.

Reddy's arrest, and the resulting allegations that he misused H-1B visas in
committing crimes, has reopened that debate.

Surprisingly, traditional opponents agree on this one. Both sides feel
Reddy's case should not be viewed as typical.

"It's something that, until it happens, you don't think about it," said
Carl Shusterman, a Los Angeles lawyer who specializes in H-1B visas and
supports increasing the annual limits on them. "The thing that would be a
shame, as far as the H-1B program is concerned, is if it was seen as a
reason not to increase the cap on how many H-1Bs are issued."

"If they crack down more on the H-1Bs, people who do these crazy things
will simply use student visas and other temporary visas," said Shusterman.

On the other side of the issue, Norman Matloff, a UC-Davis professor and
critic of H-1B visas, also warns against using the circumstances
surrounding Reddy as ammunition.

"To me, a case like this is absolutely appalling," said Matloff. "In terms
of my role as a critic of the H-1B program, this case is distracting. I
consider almost all of these visas as illegitimate."

"It's too easy for industry critics to use this (case) as an example.
Frankly, there are larger issues at hand," said Matloff.

Those issues include how H-1B is applied and how it is enforced.

How H-1B works

Hiring a foreign worker for a "specialty occupation" is no easy task. To
begin the process, the U.S. employer files a Labor Condition Application
with the Department of Labor attesting that the H-1B worker will be paid
the prevailing wage and offered the same working conditions as other U.S.

According to Immigration & Naturalization Service spokesperson Elaine
Gomez, "There is no labor market shortage test required under the H-1B
program." In other words, the INS takes a company's word that they can't
find home-grown talent.

The Department of Labor, however, does release studies on what job
shortages exist. Those studies are usually used to determine the validity
of a company's claims.

Next, the U.S. employer files a petition with the INS along with evidence
of the foreign worker's credentials and qualifications as a specialty worker.

Finally, the foreign worker must apply to an American consulate for an H-1B
visa before entering the United States.

While abuse of this process is not unheard of, said Shusterman, it's not
the norm. Reddy's case, in particular, appear to be an anomaly.

"That particular twist is a new one to me, and I've been doing this for 25
years," said Shusterman. "It's usually fraud on the principal worker and
not usually involving extra family members."

Indeed, fraud involving the principal worker is fairly common. Last year,
the U.S. consulate in the Indian city of Chennai unearthed a forgery ring
that was falsifying education and workplace documents.

"Some of these job shops would apply for H-1Bs and something would seem
funny," said Shusterman. "They'd send it for investigation in India and
find the documents were simply forged on a computer. U.S. investigators in
India found quite a lot of fraudulent documents."

'Easy to fool INS'

That doesn't surprise Matloff, who says the entire H-1B process is ripe for

"It's easy to fool the INS as well their employers," said Matloff, holding
up the Chennai incident as a case in point. "What's interesting is that
these people were coming to the U.S. were fraudulent and the employers
didn't know the difference."

In another publicized case, Deep Sai Consulting Inc., of Atlanta, pleaded
guilty to alien smuggling charges last November. An INS investigation,
sparked by an unusual number of H-1B applications filed by the company,
resulted in the conviction of company president Syamala Kaqmineni.

The investigation revealed that the majority of visa beneficiaries admitted
into the United States did not qualify for the visa and were brought here
in anticipation of illegal employment. The workers, according to the INS,
were usually Indian.

The fact that these incidents of H-1B fraud involved Indian programmers is
not surprising, simply because that country's residents receive
approximately 40 percent of the H-1B visas issued every year, according to
INS estimates.

Indian programmers have successfully used the H-1B program since its
inception, becoming one of the most powerful and successful immigration
forces in this country's history. Countless firms in Silicon Valley have
been launched by Indian technologists, while others climb the corporate
ladder at some of the Bay Area's biggest firms.

According to Prem Hinduja, president and chief executive of Global Software
Resources in Pleasanton, that migration continues apace.

"About 60 to 70 percent of our hires are local," said Hinduja, whose firm
specializes in Internet services. "Thirty to 40 percent come from abroad.
Primarily, the people we bring in on H-1Bs are from India. This is simply
supply and demand."

Recruiting trips

Hinduja, accompanied by his top technical staff, goes to India three or
four times per year, recruiting and meeting with engineering candidates.

"When we visit, the interviews are lined up," said Hinduja, referring to
Indian recruiting agencies that assist in rounding up candidates. "Then we
go through due diligence to make sure the candidates' paperwork is real.
There's a lot of fraudulence there."

"We verify their work and education records. Then, we go through an
application process here ......... justifying to INS that there is a labor
shortage here."

Regarding Reddy's situation, Hinduja was indignant, saying the vast
majority of Indian H-1B recipients are upstanding immigrants, looking to
improve their lot in life.

"I don't think it's very common. I hope it's not very common," said
Hinduja. "Unfortunately, some people slip through, which is an unfortunate
abuse of this law. It reflects badly on us."

Indeed, Reddy's case has many Bay Area residents asking how H-1B rules are
enforced. The fact is, there is little follow-up once recipients come to
the United States.

"They do minimal spot checking in this system," said Shusterman. "They rely
on people to file complaints against the employers if there are abuses."

INS officials concur. "There's no follow-up we do, as far as checking up on
employers," said Gomez. "We do expect that employers will come to us when
their H-1B employees have violated the terms."

Melanie Orhant

Stop-traffic is facilitated, international electronic list
funded by the Women's Reproductive Health Initiative
of the Program for Appropriate Technology in Health (PATH)
dealing with human rights abuses associated with trafficking
in persons, with an emphasis on public health and trafficking
in persons for forced labor, including forced prostitution,
sweatshop labor, domestic service and some coercive mail
order bride arrangements.

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