Jury convicts brothers in H-1B fraud case, jail possible

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Two brothers who used H-1B workers to create a low-cost and profitable on-demand workforce were found guilty of violating the law in federal court on Nov. 12.

The trial took place in U.S. District Court in Dallas and lasted for six days. At the end, a jury convicted Atul Nanda, 46, and his brother, Jiten "Jay" Nanda, 44, of one count each of conspiracy to commit visa fraud and conspiracy to harbor illegal aliens and four counts each of wire fraud. The U.S. filed the indictment in 2013.

Penalties range as high as $250,000 in fines and upward of 20 years in prison. A sentencing date was not set.

The case involves Dibon Solutions, an IT consulting firm created by the Nanda family.

The U.S. argued that the brothers recruited foreign citizens and sponsored H-1B visa workers with the purpose of working at Dibon's office in Texas. But the company "did not have an actual position at the time [the foreign workers] were recruited" and those employees ultimately provided consulting services to third-party companies.

The government said that H-1B workers were only "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."

"The conspirators falsely represented that the workers had full-time positions and were paid an annual salary, as required by regulation to secure the visas," said the government, in a statement announcing the conviction.

The case was investigated by the U.S. Department of Homeland Security, DHS's Immigration and Customs Enforcement agency, and the U.S. Department of State.

The scheme, said the government, provided Dibon with "a labor pool of inexpensive, skilled foreign workers" -- and it was profitable. The workers were used on an "as-needed" basis. The business "required minimal overhead, and Dibon could charge significant hourly rates for a computer consultant's services," the federal government said.

Dibon's owners "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 said, describing a type of scheme that's known in the industry as "benching."


Copyright © 2015 IDG Communications, Inc.

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