H-1B placement firm charged with visa, wire fraud

Texas company did not pay “benched” workers.

Bureau Report

WASHINGTON, DC: An H-1B placement operation in Texas, owned by Indian-origin entrepreneurs, has been charged with mistreating its workers, misleading the U.S. government, and engaging in both visa fraud and wire fraud.

Earlier this month, Dibon Solutions of Carrollton, Texas, and six of its current or former executives were hauled into federal court in Dallas to face these counts. The principal defendants are Atula and Jiten “Jay” Nanda, two feuding brothers who had at one point owned the company jointly. They are currently engaged in a separate court battle with each other over the control of the firm, a report by the Center for Immigration Studies said.

The conspirators told the Departments of Labor, Homeland Security, and State that they had full-time jobs for computer programmers; they obtained H-1B visas for the workers, and brought them to Texas, promising full pay even when work was not available for the nonimmigrants. Dibon’s business was the renting out of H-1B workers to high-tech firms.

But work was not always available, and the “benched” H-1Bs were not paid or not paid in full when they were not working — contrary to the law. The conspirators would then encourage the benched workers to go out and try to drum up business for Dibon, so that they could go back to work.

The indictment indicated that this happened to eight individuals in the years 2008, 2009, and 2010.

The court filings in the criminal case do not discuss the micro-economics of the situation, such as how much the H-1Bs were paid and how much they were supposed to be paid. But the civil case (between the brothers) indicates that amounts as high as $2.7 million were among the bones of contention, suggesting a successful family firm, said the report.

The scheme, the indictment alleges, “provided the conspirators with a labor pool of inexpensive, skilled foreign workers who could be used on an ‘as needed’ basis.” This operation “was profitable because it required minimal overhead and Dibon could charge significant hourly rates for a computer consultant’s services.”

The IT firm “earned a substantial profit margin when a consultant was assigned to a project and incurred few costs when a worker was without billable work,” the government wrote.

Apart from the Nanda brothers, others charged in the case are Siva Sugavanam, Vivek Sharma, Rohit Mehra, and Mohammad Khan.

The multi-count indictment also includes wire fraud for using e-mail to execute the scheme.

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