Federal Jury Convicts 2 Brothers of Visa Fraud
By Bruce Buchanan, Siskind Susser
On November 20, 2015, a North Texas federal jury convicted two brothers of felony visa fraud based on their conspiracy to secure a low-cost workforce at Dibon Solutions, their North Texas information technology consulting company, from March 2005 to February 2011.
Atul Nanda and Jiten Nanda were each 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 conspiracy to commit visa fraud count carries a maximum statutory penalty of five years in federal prison and a $250,000 fine. The conspiracy to harbor illegal aliens count carries a maximum statutory penalty of 10 years in federal prison and a $250,000 fine. Each wire fraud count carries a maximum statutory penalty of 20 years in federal prison and a $250,000 fine.
The government presented evidence at trial that as part of their scheme, the Nanda brothers recruited foreign workers with expertise who wanted to work in the U.S. The brothers sponsored the workers' H-1B visas with the stated purpose of working at Dibon headquarters in Carrolton, Texas. In fact, however, the business did not have an actual position at the time that the workers were recruited. The brothers 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, Jiten 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 brothers falsely represented that the workers had full-time positions and were paid an annual salary, as required by regulation to secure the H-1B 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 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."
The government presented further evidence that the Nandas required the H-1B visa candidates to pay the processing fees that the law requires to be paid by the company. The evidence presented at trial showed that the Nandas attempted to hide this by having the H-1B candidates pay the fees directly to Dibon either with cash or a check written to "Dibon Training Center."
These convictions are prime examples of the criminal penalties that one can receive for H-1B fraud. They also add “fire” to arguments raised by Senator Charles Grassley of the abuses in the H-1B visas.