By Rob Sanchez
08/01/2009
The story about the fraud case against Vision System is several months old. What little news coverage the story received has subsided, but the case is still working its way through the courts — and hopefully those arrested are still in jail. After obtaining a couple of the court documents I decided to revisit the case.In February 2009 the U.S. Immigration and Customs Enforcement (ICE) agents arrested 11 people in 7 states. [11 arrested, indicted in multi-state visa fraud operation] — ICE Press release] The suspects are all of Indian origin but at this time I don’t have information on their immigration status.[Indians involved in major US H-1B visa racket, Times Of India, February 13, 2009] Many government agencies were involved in the investigation including the Department of Labor, Postal Inspection Service, Department of State, Social Security Administration’s Office of the Inspector General, and the U.S. Attorney’s Office for the Southern District of Iowa.
Several companies including Vision Systems are accused of visa fraud, mail fraud, wire fraud, money laundering, and conspiracy.
Patrick Thibodeau wrote a Computerworld article about the Vision Systems arrests, although you wouldn’t know it by the title of the article: "H-1B workers outnumber unemployed techies". He had a comment that was quite alarming:
"in January of 2009, the total number of workers employed in the information technology occupation under the H-1B program substantially exceeded the 241,000 unemployed U.S. citizen workers within the same occupation."[U.S.: H-1B workers outnumber unemployed techies | Fraud case raises questions about visa program, By Patrick Thibodeau, Computerworld, May 26, 2009]Say what? Did Thibodeau just say that the total number of H-1B workers outnumber unemployed techies? The answer is yes, that’s what he wrote. He didn’t make it clear that he got that startling information directly from court records — in this case from document #22 (see link below).
The indictment documents contain other gems worthy of discussion.
Upon closer review the case is very different than what we have previously seen involving H-1B. In the past most court cases were prosecuted on the behalf of H-1Bs who got shafted by employers who underpaid them, and occasionally there is a case that involves a few individuals that conspired in a visa scam. While on the surface the Vision case would seem to fall into the latter category because of the visa fraud there is far more to it because this time because the U.S. government is accusing employers of purposefully using H-1B to discriminate against U.S. workers. Here is more from document #22:
Although the sufficiency of an indictment is generally determined by the four corners of a document, the government is prepared to demonstrate to the Court the manner in which the defendant’s schemes, along with similar schemes by similar companies have substantially deprived U.S. citizens of employment. [IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF IOWA,UNITED STATES OF AMERICA, Plaintiff, v VISION SYSTEMS GROUP, INC.,Defendant, Document 22 (PDF)]One of the barriers hampering Americans from being able to sue employers is the lack of a legal precedent that U.S. citizens are harmed by H-1B. The lack of a precedent has discouraged many American workers from taking legal action against employers. Perhaps this case could be used as a new precedent. It has the potential of becoming a major breakthrough for American workers who have been displaced and discarded in favor of H-1Bs. The following passage is substantial, and may be the most important part because there is a recognition that American workers suffer real damage when the H-1B program is used to discriminate against them.
Although the exact amount of loss to U.S. citizen workers has not yet been determined, there is no question that the amount of lost wages and benefits to U.S. citizens has been substantial.The government makes the argument that abusing H-1B is tantamount to taking property away from workers. It’s a good argument because Amendment 5 of the U.S. Constitution requires the government to protect property from illegal seizure.
It is also generally recognized within the Eighth Circuit that the term "intent to defraud" means to act knowingly and with the intent to deceive someone for the purpose of causing some financial loss or loss of property or property rights to another or bringing about some financial gain to ones self or another to the detriment of a third party.Vision Systems is being accused of several different types of fraud including placing fake job ads. As we know, companies do this routinely but they rarely get in trouble for it.
In addition to the general intent to deprive U.S. citizens of employment contracts, wages and benefits, the government also has evidence from seized records demonstrating the manner in which specific U.S. citizens were denied meaningful opportunities for employment. Vision Systems Group and other related companies repeatedly advertised information technology jobs within the United States as a "mere formality", and never acted upon any of the resumes' submitted by U.S. citizens seeking such employment. In fact, Vision Systems Group and related companies consistently hired only foreign workers in order to fill information technology positions within the United States.Document 34 contains a defense by Vision Systems. Notice that they characterize the accusation that H-1B was used to defraud Americans out of jobs as a "new theory" by the U.S. government. They seem to be well aware that up until this point the legal system has refused to recognize that H-1B harms American workers.
In addition to being legally defective, however, the governments new theory portends a trial about immigration policy, not criminality. The government’s brief previews evidence it will introduce at trial: "In January of 2009, the total number of workers employed in the information technology occupation under the H1B program substantially exceeded the 241,000 unemployed U.S. citizen workers within the same occupation." This "evidence" is strikingly similar to objections to the H-1B program urged by its political opponents. See Patrick Thibodeau, "Grassley: H-1B Visas Used to Displace U.S. Workers (online at computerworld.com).[Vision Systems vs. U.S. Document 34 PDF]It’s very odd that Vision Systems makes the claim that the U.S. government has been misled by Patrick Thibodeau. They used a very bad example because the article quoted never compares the number of H-1Bs to high tech workers. It almost seems that Vision Systems had an axe to grind against Thibodeau so they randomly picked one of his many articles about H-1B. I hope the judge reads that article because he will be perplexed why the defense chose that one as an example. Using Thibodeau as a scapegoat is unlikely to help their cause because the facts on H-1B are widely known and Thibodeau is just one of many journalists who write about the topic.
Vision Systems denies the mail fraud charge, and then attempts to dispute the claim that jobs are property. They trivialize the situation by claiming that depriving Americans of a chance to get a job (fake job ads, phony interviews) is not equal to depriving somebody of their property. Their argument is very circular and appears to be an act of desperation by Vision Systems.
First, the government still has not identified a deprivation of property within the meaning of 1341. The thing the government says people lost — the mere prospect of employment — is not property in the hands of a job applicant. Second, even if the employment prospects did count as property, the government fails to allege that Vision Systems schemed to obtain that property. Indeed, it is hard to see how Vision Systems could scheme to obtain its own jobs.I read that silly thing about dozen times and it still doesn’t make a bit of sense. Their argument is analogous to stating that you can’t be robbed if banks refuse to give you money. Judges usually aren’t impressed by circular arguments and hopefully this will be no exception.
REFERENCES:
https://www.businessweek.com/bwdaily/dnflash/content/feb2009/db20090212_920784.htm Visa Fraud Sparks Arrests Nationwide
H-1B visas being used to displace U.S. workers | But senator says he'd consider increasing annual cap if visa program isreformedBy Patrick Thibodeau, Computerworld, November 6, 2007
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