N.J.: Execs Arrested for H-1B Visa Fraud

By Diane Cadrain Jun 10, 2015

Two New Jersey women, Hiral Patel and Shikha Mohta, both of Jersey City, have been arrested for fraudulent use of the nation’s H-1B visa program to reduce skilled labor costs. They face a maximum potential penalty of five years in prison and a $250,000 fine.

According to Paul J. Fishman, U.S. Attorney for New Jersey, Patel, Mohta and other conspirators recruited foreign workers looking for IT jobs in the United States. They told the Department of Homeland Security that the foreign workers would be given full-time jobs and be paid annual salaries—both required for the issuance of the H-1B visa—and that they would work for the clients of two companies, SCM Data and MMC Systems, of which Patel and Mohta were executives.

Despite these promises, Patel and Mohta paid the foreign workers only when they were placed at a third-party client who entered into a contract with SCM Data or MMC Systems. In some cases, Patel, Mohta and the others generated false payroll records to create the appearance that the foreign workers were paid full-time wages. Many times, Fishman’s office stated, the conspirators required workers to pay SCM Data or MMC Systems their gross wages in cash. In exchange, SCM Data or MMC Systems would subtract taxes and fees and issue payroll checks to the foreign workers in a smaller amount. The conspirators then encouraged the foreign workers to submit the bogus payroll checks to the DHS as proof that the workers were engaged in full-time work despite the fact that they were not working for SCM Data and MMC Systems.

“This scheme provided Patel, Mohta and others with a labor pool of inexpensive, skilled foreign workers who could be used on an “as needed” basis,” Fishman’s office stated. “The scheme was profitable because it required minimal overhead, and SCM Data and MMC Systems could charge significant hourly rates for the foreign workers’ services. The conspirators earned a substantial profit margin when a foreign worker was assigned to a project and incurred few costs when a foreign worker was without billable work.

The women are charged with conspiracy to bring in and harbor aliens.

Diane Cadrain is an attorney who has been writing about employment law issues for more than 20 years.

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