Earlier this week, Infosys, a Bangalore-based outsourcing company, agreed to pay a civic settlement of $34 million for “systematic visa fraud and abuse” as announced by Texas prosecutors, after two years of investigation. This serious offense constitutes the largest fine in history for an immigration law violation. How did this happen and what can companies learn from this case to ensure compliance with immigration laws?
Infosys is India’s second largest software exporter, employing 160,000 people in 30 countries, including 15,000 in the U.S. A probe conducted by the Department of Homeland Security and the State Department revealed that Infosys knowingly bypassed governmental oversight in the H-1B (professional worker visa) program. By using B-1 visa (business visa) holders to perform tasks which would have otherwise been performed by U.S. citizens and those on valid H-1B visas, Infosys obtained an “unfair advantage over competitors and avoided tax liabilities”. Court documents reveal that Infosys aimed to cut its costs and processing times, and avoid quotas for immigration procedures by using misleading invitation letters containing fraudulent statements regarding the visa holder’s true purpose of travel. The letters usually mentioned a business meeting or a negotiation as the purpose of the trip, when in reality the visitors were performing contract-work which displaced domestic workers. Furthermore, Infosys even created a special “Do’s and Don’ts” document for new arrivals containing the following advice:
“Do not mention activities like implementation, design & testing, consulting, etc., which sound like work”; “Also do not use words like, work, activity, etc., in the invitation letter”; and “Please do not mention anything about contract rates”
Clearly, Infosys utilized the B-1 visa for unauthorized purposes as defined by USCIS.
In general acceptable B-1 activities include
- negotiating contracts,
- attending conferences,
- representing the overseas employer in dealing with vendors, suppliers, customers, etc.
- undertaking short-term projects in the B-1 visitor’s area of expertise. These projects may include providing or receiving training or consultations.
A person holding a B-1 visa may not work for a US employer. In other words, the activities that a B-1 visa holder performs in the US cannot be the same activities which are performed by employees or contractors of a US company.
Misuse of B-1 visas was not the only serious and blatant violation of immigration law, Infosys also had other less obvious, but equally significant infractions in regards to I-9 compliance. It turns out that Infosys failed to maintain I-9 records for many of its foreign nationals in the United States in 2010 and 2011 as required by law; 80% of all I-9s from Infosys contained substantive violations. Although they are more difficult to detect, I-9 violations are not insignificant and present themselves as costly “Skeletons in the Closet” for many U.S. companies.
The following is a list of proven strategies that help companies ensure immigration compliance.
- DO NOT bring an employee to the US under the B-1 if the employee’s activities in the US will involve any activity that a US worker could perform.
- Maintain accurate and updated I-9 records for all employees (use E-Verify to simplify the process).
- Never sign or write misleading or fraudulent documents on behalf of employees.
- Use the visa type that appropriately matches the type and duration for which work will be done.
 Typically ~$5000 which must be paid by the employer.
 An annual cap of 65,000 workers per year was reached within the first week of applications in 2013.
Niko Druzhinin is a legal assistant at Lipman & Wolf, LLP and is currently pursuing a master’s degree in Global Policy Studies at the Lyndon Baines Johnson School of Public Affairs in the University of Texas at Austin. Niko received his Bachelor’s degree from UC Santa Barbara in Global and International Studies with an emphasis in the Latin America region. Niko is fluent in Spanish and Russian. If you have questions or comments about the article, please contact us.