NY Couple Pays $1 Million Penalty in Immigration Fraud Scheme Involving Philippine H-1B Nurses

Posted: 3:01 am ET
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Via USDOJ/Vermont:

New York Lawyer and Wife Pay $1 Million Following Conviction on Immigration Fraud Scheme

The Office of the United States Attorney for the District of Vermont announced today that Loreto Kudera, age 45, and Hazel Kudera, age 43, a married couple from New York, New York, who have pleaded guilty to an immigration fraud scheme, have paid the final installment of their $1 million forfeiture penalty representing ill-gotten gains from the scheme.

On June 9, 2016, the Kuderas pleaded guilty to charges that they conspired to commit immigration fraud. According to the public record, Hazel Kudera owns several medical staffing agencies in New York specializing in providing nursing professionals to hospitals, outpatient and skilled nursing facilities. She and her husband, Loreto Kudera, then a lawyer at the Law Offices of Barry Silberzweig, in New York, New York, provided false and fraudulent information to the U.S. Citizenship and Immigration Services in St. Albans, Vermont when applying for  for foreign nurses.

The H-1B visa program permits an employer to petition on a behalf of a foreign national beneficiary to enter the United States for the specific purpose of working for the employer in a specialty occupation. There are a limited number of H-1B visas available each year, and the purpose of the program is to ensure that these visas go to legitimate beneficiaries to fill specialty positions from a qualified work force. Working as a general RN or LPN is not considered a specialty occupation by the U.S. Citizenship and Immigration Service. Knowing this, Hazel Kudera and Loreta Kudera falsely stated that these foreign nurses, mostly from the Philippines, would be working in specialty occupations at prevailing wage rates when, in fact, they were going to work as LPNs or RNs at much lower rates, mostly at nursing homes. Hazel Kudera and Loreto Kudera profited from this scheme from the filing fees they collected from the beneficiaries as well as from the health care facilities which were paying fees to the medical staffing agencies owned by Hazel Kudera. The Kuderas admitted that they submitted 100 or more fraudulent petitions as part of their scheme. As a result of their convictions, the Kuderas agreed to forfeit $1,000,000 in illegal proceeds to the United States.

The Kuderas are scheduled to be sentenced on September 28, 2016. The maximum penalties for their conviction are five years of imprisonment, three years of supervised release, or a fine of $250,000 or twice the amount of gross gain, whichever is greater. The sentence will be advised by the United States Sentencing Guidelines.

The United States Attorney commended the investigative efforts of the United States Department of State, Diplomatic Security Service, the United States Department of Labor Office of Inspector General, Office of Labor Racketeering and Fraud, and the United States Department of Homeland Security, Homeland Security Investigations, in Boston, Massachusetts, who jointly spearheaded the investigation. The United States Attorney also wishes to thank the United States Citizenship and Immigration Service, Security Fraud Division, at the Vermont Service Center in St. Albans, Vermont for their assistance with the investigation.

The original announcement is available here.

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Visa Fraudsters Who Recruited H-1B workers For the “Bench” Get 87 Months in Federal Prison

Posted: 3:35 am ET
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Via DOJ/Northern District of Texas:

Atul and Jay Nanda Used Their Corporation, Dibon Solutions in Carrollton, Texas, to Commit Fraud Through H-1B Visa Program to Create a Low-Cost Workforce

DALLAS — Two brothers who were convicted at trial in November 2015 on felony offenses stemming from a conspiracy they ran to commit visa fraud to secure a low-cost workforce at their information technology consulting company headquartered in Carrollton, Texas, were sentenced today to lengthy federal prison terms, announced U.S. Attorney John Parker of the Northern District of Texas.

Atul Nanda, 46, and his brother, Jiten “Jay” Nanda, 45, were each sentenced by Chief U.S. District Judge Barbara M. G. Lynn to 87 months in federal prison.  Each was convicted on one count of conspiracy to commit visa fraud, one count of conspiracy to harbor illegal aliens, and four counts of wire fraud.  The brothers, who have been on bond, were remanded to the custody of the U.S. Marshals Service.

Dibon Solutions is an information technology consulting company located on Chenault Drive in Carrollton; it is a family operation created by the Nanda family.  Atul and Jiten Nanda created, established, and ran the corporation that they used to commit fraud through the H1-B visa program.

“The H-1B visa program is a powerful and positive tool for businesses and foreign workers alike when properly used,” said U.S. Attorney Parker.  “When employers abuse the program, however, the foreign workers become a captive stable of cheap labor, victimized to the company’s financial benefit.”

“This federal investigation uncovered Dibon’s deeply rooted conspiracy of maximizing its profits at all costs,” said Katrina W. Berger, special agent in charge of Homeland Security Investigations (HSI) Dallas.  “These two brothers created a highly profitable, and highly illegal business model at the extreme expense of the alien workforce that they recruited.  In addition, this same illegal business model operated at an unfair advantage to Dibon’s competition since it had a much lower operating overhead.”

The H-1B visa program allows businesses in the U.S., such as Dibon, to temporarily employ foreign workers with specialized or technical expertise in a particular field such as accounting, engineering, or computer science.

The Nanda brothers recruited foreign workers with expertise who wanted to work in the U.S.  They sponsored the workers’ H-1B visa with the stated purpose of working at Dibon headquarters in Carrolton, but, in fact, did not have an actual position at the time they were recruited and knew the workers would ultimately provide consulting services to third-party companies located throughout the U.S.  Contrary to representations made by the conspirators to the workers (and the government), Jay and Atul Nanda directed that the workers only be paid for time spent working at a third-party company and only if the third-party company actually first paid Dibon for the workers’ services.  Additionally, in Dibon’s visa paperwork, the conspirators falsely represented that the workers had full-time positions and were paid an annual salary, as required by regulation to secure the visas.

This scheme provided the conspirators with a labor pool of inexpensive, skilled foreign workers who could be used on an “as needed” basis.  The scheme was profitable because it required minimal overhead and Dibon could charge significant hourly rates for a computer consultant’s services.  Thus, the Nandas, as Dibon’s owners, earned a substantial profit margin when a consultant was assigned to a project and incurred few costs when a worker was without billable work.  This scheme is known as “benching.”  Dibon actively recruited H-1B workers for the “bench.”

The Nandas required the H-1B visa candidates to pay the processing fees that the law requires to be paid by the company. The Nandas attempted to hide this, however, by having the H-1B candidates pay the fees directly to Dibon either with cash or a check written to “Dibon Training Center.”

The three other defendants charged in the case, Siva Sugavanam, 37, Vivek Sharma, 48, and Rohit Mehra, 39, who each pleaded guilty before trial to one count of aiding and abetting visa fraud, were each sentenced earlier this month by Judge Lynn to two years’ probation.  Sugavanam was the lead recruiter for Dibon; Sharma acted as Dibon’s office manager; and Mehra recruited employees for the bench and transported benched employees to and from Dibon Headquarters.  All three had knowledge of and/or involvement in the filing of false documents with the Department of Labor and the Department of Homeland Security (DHS) in securing recruits’ employment with Dibon.

The case was investigated by U.S. Immigration and Customs Enforcement, HSI and the U.S. Department of State.

Original announcement is posted here.

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Visa Fraudster With 25 Fraudulent H-1B Visa Petitions Gets 3 Years Probation and $400,000 Forfeiture

Posted: 12:01 am EDT
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Via state.gov/ds:

OAKLAND, Calif. – A federal judge has sentenced a British man to three years of probation and the forfeiture of $400,000 for his role in a visa-fraud scheme, announced Special Agent In-Charge David Zebley of the U.S. Department of State’s Diplomatic Security Service (DSS) San Francisco Field Office.

Madhu Santhanam, 41, was sentenced on January 7, 2016, by U.S. District Judge Yvonne Gonzalez Rogers in the Northern District of California following Santhanam’s guilty plea to a count of conspiracy to commit visa fraud.

In his December 10, 2014, plea agreement, Santhanam, owner of Maan Systems of Union City, California, admitted that he had submitted at least 25 fraudulent I-129 petitions between September 2009 and June 2013. Employers must submit these documents to obtain H-1B visas for highly skilled immigrant applicants seeking to work in the United States.

In many of his fraudulent I-129 applications, Santhanam falsely indicated that the applicants would be working at his company or placed at Fortune 500 companies, but instead he placed the workers at unapproved worksites. As part of his plea agreement, Santhanam paid a forfeiture judgment totaling $400,000.

The successful prosecution was the result of an investigation led by the DSS special agent assigned to the Document and Benefit Fraud Task Force (DBFTF), an interagency investigative body overseen by the Homeland Security Investigations Directorate of the U.S. Department of Homeland Security’s Immigration and Customs Enforcement.

So no jail time, only probation, and he forfeited $400K to USG, which is about $16K per fraudulent H1-B visa petition. A high risk, high return enterprise.

When the guilty plea was announced in December 2014, DOJ says that the maximum statutory penalty for conspiracy to commit visa fraud, in violation of 18 U.S.C. §§ 371 and 1546, is a maximum term of 5 years in prison, a fine of $250,000, and 3 years of supervised release.

Wow! All that work for the feds, and over 12 months after the guilty plea, and not a single day in jail. What does it take before fraud like this gets taken seriously enough that we actually put people in jail?

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