Company Prosecuted for H-1B Fraud
Company Prosecuted for H-1B Fraud
Date: Wednesday, April 05, 2006 11:15 PM
JOB DESTRUCTION NEWSLETTER
April 05, 2006 No. 1453
The Department of Labor fined "Home Mortgage Company of America" (HMCA) for
exploiting H-1Bs and for various other violations of the law. Secretary of
Labor Elaine Chao is using the case as proof to the world that the DOL is
vigilantly protecting workers in the USA against the exploitive scofflaws
but as usual the only ones she seems interested in helping out are foreign
workers that take jobs away from American citizens. Probably the only ones
who will believe Chao's ruse are the gullible public, the corporate owned
newspapers, and of course the politicians who are paid to believe anyone
that carries wads of cash.
"Abuse of the foreign labor certification program undermines
the integrity of the program and its goal of protecting wage
standards for U.S. workers," said Secretary of
Labor Elaine L. Chao. "As these cases demonstrate, this
Administration will aggressively pursue companies that violate
this program."
Chao's bloviating aside, the DOL rarely investigates cases of H-1B
exploitation and usually when they do it's because an H-1B raised a big
enough fuss. U.S. citizens are routinely ignored when they complain to the
DOL about employers who violate H-1B regulations. Our government has
changed their focus to service the needs of foreign workers and the
corporations that hire them - not citizens. The ruling against HMCA is just
for show. It may be timed to help support the Specter or Frist bills.
To read the legal document about the HMCA case go to:
http://www.oalj.dol.gov/Decisions/ALJ/LCA/2004/WAGE_and_HOUR_DIVISI_v_THE_HOME_MORTGAGE_CO_2004LCA00040_(MAR_06_2006)_133459_CADEC_SD.PDF
That's sort of a big ugly link, so I set up a short link just to save you
some frustration:
http://makeashorterlink.com/?I24E359DC
The legal document is long but it's a thoroughly entertaining story of
scandal and good ol' American avarice. Reading the document is sort of like
looking at the Grand Canyon - you notice new rock formations every time you
look down.
HMCA's downfall began when they fired a Filipino H-1B named Ms. de Guzman.
Guzman discussed the firing with her pastor who put her in touch with a
friend who worked for the INS. The INS guy asked Guzman for her pay stubs.
After a few months, she received a call from the Department of Labor
requesting an interview. The DOL conducted an investigation into HMCA based
on her complaint. It's important to note that HMCA probably never would
have been caught if Guzman hadn't filed a complaint. There are hundreds if
not thousands of other companies just like HMCA that engage in similar
fraudulent hiring practices.
I know most of you are too busy to read long legal documents, so allow me
to list some of the highlights of this case.
FOLKS, IT JUST DOESN'T GET BETTER THAN THIS!
First let's look at some of the fourteen H-1B litigants, as well as the man
that hired them:
(*) Roland David, founder, President and sole shareholder of Home Mortgage
Company of America (HMCA)
He helped his Filipino workforce to falsify documents such as fake diplomas
and he entered fraudulent information on the LCAs. He provided housing and
food for his workers but didn't report that as income to the INS and he
used other dubious means to avoid paying taxes. When the DOL started
investigating him, he prepared fraudulent documents with back dating.
(*) Leni de Guzman accountant, credit analyst, $350 per week
Wife of Reynaldo de Guzman. Ms. De Guzman obtained a bachelor's degree in
accounting from a college in the Philippines. She paid $1,805 for her H-1B
visa.
(*) Reynaldo de Guzman marketing, advertising and client services, $350 a
week
Mr. de Guzman had a diploma that said he had a Bachelor's degree in
marketing but the diploma was fake. He paid $1,850 to an attorney for the
purpose of obtaining an H-1B visa.
(*) Marvin Del Rosario, computer maintenance, $350 a week
Mr. de Guzman obtained a Bachelor's degree in business administration. The
only problem is that his diploma was fake. He came to the U.S. on a tourist
visa and began working for HMCA. His boss at HMCA, Mr. David, helped him to
obtain false documents that showed he was a computer engineer. Guzman paid
an attorney $1,850 for his H-1B visa.
(*) Grace Nancienciano, $350 a week
She is seeking a green card which is being sponsored by her boss, Mr.
David.
(*) Luisito Torres, loan processor, $400 a week
While in the Philippines he was helped by HMCA to get false documents to
show that he was a computer programmer. Mr. Torres was hired by HMCA on
September 29, 2001. In March of 2002, HMCA sponsored an H-1B visa for Mr.
Torres, for which Mr. Torres paid approximately $1,800.
(*) Arturo Uy, credit analyst.
Mr. Uy paid approximately $1,100 in connection with his H-1B petition. He
is seeking a green card which is being sponsored by his boss, Mr. David.
(*) Amor Venzon, marketing, $350 per week
He worked 12 hours a day for 5 days a week. He came to the U.S. on a
tourist visa and immediately started working. HMCA filed an H-1B visa
claiming that Venzon was a computer engineer. Venzon testified that he is
somewhat computer literate. Mr. Venzon paid approximately $1,850 in
connection with his H-1B visa.
Other H-1B employees included:
Diosdado David advertising, marketing, loan packaging
Evelyn Henson credit analyst
Leonia Mayuga credit analyst
Deogracias Mendoza reviewed house appraisals
Maria Nacienciano marketing management (coordinating with investors)
Christina Nario credit analyst
Vivian Uy Garcia office manager (and coordinated with investors and
accounting)
***** THE RULING *****
The judge got HMCA for the following violations. There are a few other
technical violations but these are the most important.
1) There was a big disparity between the salary stated on the Labor
Condition Application (LCA) and the much lower salary that the H-1Bs
received. The disparity between the salary listed on the LCAs and the
weekly wage actually received by the employees averaged $118 and $673 per
employee per week.
2) HMCA got caught lying - the judge calls it willful misrepresentation of
a material fact. They routinely entered a job category on the LCA that
didn't match what the H-1B actually did. As an example, Luisito Torres was
hired as a computer programmer but worked as a loan processor. It's
puzzling why HMCA lied in this fashion because had they been honest on the
LCA the H-1B would have been approved anyway. It's not at all unusual for
H-1Bs to hold positions like the ones at HMCA - there is no need to lie
about being a computer programmer.
3) H-1B regulations are very specific about who pays for the visa - the
employer. All of the HMCA H-1Bs were required to pay for their visas which
is a clear violation of the law.
4) Most of the Filipinos came to the U.S. on tourist visas and starting
working for HMCA before they got authorization to work in the U.S. This is
a clear violation of our immigration laws that require authorization to
work in the U.S. as well as H-1B regulations that don't allow employers to
hire aliens before applying for an H-1B visa. There are some exceptions,
such as the one that allows students to work under a program called
"Optional Practical Training" (OPT). Incidentally, the immigration bill in
the Senate will allow unlimited numbers of foreign students to get OPT so
that they can take jobs from Americans while they are using our college
system to get degrees. If you are wondering why these wonder kids need so
much training, perhaps you should ask the Congressmen or President Bush who
think that foreigners has an exclusive monopoly of skills and knowledge.
***** THE PENALTY *****
IT IS THEREFORE ORDERED that Respondents shall pay back wages totaling
$513,036.56 to the following persons in the specified amounts:
Diosdado David $19,011.93
Leni De Guzman $20,374.97
Reynaldo De Guzman $45,187.46
Marvin Del Rosario $92,008.82
Evelyn Henson $13,499.98
Mylene Juan $46,596.36
Leonia Mayuga $22,374.80
Deogracias Mendoza $8,183.60
Maria Nacienciano $33,341.17
Christina Nario $51,390.00
Luistio Torres $40,896.00
Arturo Uy $50,808.77
Vivian Uy Garcia $37,693.80
Amor Venzon $31,668.90
IT IS FURTHER ORDERED that Respondents shall pay civil money penalties
totaling $84,000.00 to the Wage and Hour Division and be disqualified from
filing new H-1B petitions for a period of two years.
***** THINGS TO PONDER *****
Many of the Filipinos obtained fake diplomas in order to misrepresent what
kind of job they were qualified to take in the United States. They had no
qualms about cooperating with HMCA when it came time to lie on the visa
paperwork. Their testimony indicates that they all understood that what
they were doing was illegal but they didn't care as long as it allowed them
to get a job in the U.S. I guess the reason they didn't care about our laws
is that they knew that nothing would happen if they got caught - and they
were right!
Technically speaking most of these Filipinos are illegal aliens, not H-1Bs,
and they are also guilty of fraud. All visas should be revoked if they were
obtained fraudulently, which would put all of these liars "out of status"
and subject to deportation.
As you can see, they won some very generous settlements which just goes to
show you that despite the whining by groups such as the militant Mexican
protestors that have takent to our streets, the U.S. legal system is very
kind to illegal aliens.
In the entire document I never read anyone who questioned the legality or
morality of allowing illegal aliens win monetary settlements, nobody
ordered them to be deported, and some of them are even applying for Green
Cards for permanent residency. At the very least none of these aliens
should be allowed to get Green Cards since they willfully defrauded our
immigration laws.
Mr. David, the owner of HMCA was the perpetrator of these crimes. The court
ruled that he was individually liable but nothing happened to him or any of
the others within the company who committed this fraud. HMCA had to pay
back wages but that's just the money they would have paid had they followed
prevailing salary standards. The civil penalties of $84K are a pittance.
Probably the only thing that hurts HMCA is that they can't hire H-1Bs for
two years.
So what is wrong with this picture?
+++++++++++++++++++++++++++++++++++++++++++++++++++
http://www.oalj.dol.gov/Decisions/ALJ/LCA/2004/WAGE_and_HOUR_DIVISI_v_THE_HOME_MORTGAGE_CO_2004LCA00040_(MAR_06_2006)_133459_CADEC_SD.PDF
http://releases.usnewswire.com/GetRelease.asp?id=62749
New Jersey Employers Ordered to Pay Over $650,000 in Back Pay and
Penalties; Companies Found in Violation of H1B Visa Program
3/22/2006 10:58:00 AM
Contact: Leni Uddyback-Fortson of the U.S. Department of Labor,
215-861-5102
PHILADELPHIA, March 22 /U.S. Newswire/ -- Administrative Law Judges from
the U.S. Department of Labor have found two New Jersey companies and their
presidents in violation of the Immigration and Nationality Act and ordered
them to pay $567,090 in back wages to 16 foreign workers hired under the
Act's H-1B visa program.
"Abuse of the foreign labor certification program undermines the integrity
of the program and its goal of protecting wage standards for U.S. workers,"
said Secretary of Labor Elaine L. Chao. "As these cases demonstrate, this
Administration will aggressively pursue companies that violate this
program."
One Administrative Law Judge (ALJ) ruling held that Home Mortgage Company
of America Inc., located in Hamburg, N.J., and its president, Roland David,
willfully failed to pay 14 foreign workers the prevailing wages required by
law. The defendants also misrepresented the job classifications on the
labor condition applications used to obtain employment status for the
workers. The company and David were ordered to pay $513,036 in back wages
and $84,000 in civil money penalties and were disqualified from
participating in the H-1B visa program for two years.
In another decision, an ALJ found that Priority I Software Solutions,
Cinnaminson, N.J., and president, Anthony Corradetti, did not pay two
foreign workers the prevailing wage. Corradetti was held personally liable
for $54,054 in back wages.
The H-1B visa program permits employers to temporarily hire foreign workers
to fill specialized jobs in the United States. Employers must pay H-1B
workers at least the same wage as other employees who perform the same type
of work or the prevailing wage in the area. The law also requires companies
to accurately specify the terms and conditions under which the workers will
be employed.
Information about the H-1B visa program's worker protection provision may
be obtained by calling the Department of Labor's toll-free helpline at
1-866-4USWAGE (1-866-487-9243). Information is also available on the
Internet at http://www.wagehour.dol.gov
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