The U.S. Department of Labor Inspector General Anthony D. Esposito has warned employers against manipulating the visa system through fake jobs, sham employers and wage kickbacks, saying businesses relying on such practices should face legal action.
Taking to X, he wrote, “A visa is not a license to cheat American workers. Fake jobs. Sham employers. Wage kickbacks.
If your business model depends on gaming our immigration system, it deserves an investigation.
American jobs. American wages. Zero patience for fraud.”
The warning comes as the Department of Labor’s Office of Inspector General intensified scrutiny of alleged fraud around employment-based programmes, including H-1B visas.
The crackdown has included field investigations in August. Checks were conducted in Dallas at locations associated with companies that received hundreds of approved H-1B petitions. According to the agency, investigators visited establishments with more than 500 approved H-1B applications and found several with signs of inactivity, including locked doors and limited evidence of basic business operations.
As part of the investigation, employers and labour brokers suspected of submitting fraudulent applications could also face scrutiny. For legitimate H-1B employers, the programme continues to require compliance with federal wage and employment rules. Employers must meet the Labor Department’s requirements governing wages and working conditions, among other obligations.
Earlier in July, the Department of Labor had launched a nationwide investigation into suspected fraud involving the H-1B and PERM programmes. According to the agency, investigators are examining allegations including fraudulent applications, coercive wage kickback arrangements and the use of foreign workers at wages below required levels. It has also highlighted wage kickbacks as an area of concern.
Under federal law, H-1B employers are required to pay minimum wages, generally the higher of the prevailing wage or the employer’s actual wage for similarly employed workers. The department also restricts deductions that would effectively reduce H-1B workers’ pay below the required wage.