Labor Department Investigated $20 Billion in Visa Fraud
The investigation into H-1B visa programs could lead to increased recruitment scrutiny for employers.
Updated on Sept. 23, 2026 in Employment
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The U.S. Department of Labor Inspector General has identified $20 billion in suspected fraud linked to H-1B visa and foreign-labor programs. The investigation follows physical workplace inspections that revealed potentially inactive business sites.
Why it matters
The probe aims to protect U.S. workers by rooting out fraudulent visa applications, improper wage arrangements, and kickbacks. Employers may now face tighter scrutiny regarding their recruitment records and immigration filings.
The Inspector General identified $20 billion in suspected fraud across visa and foreign-labor programs. One office location in Dallas alone was associated with over 500 approved H-1B petitions, raising questions about current vetting procedures.
The players
Department of Labor
A federal agency that sets labor standards, enforces workplace laws, and manages visa certification programs for foreign workers.
Cognizant
A global technology services company that has had its PERM foreign-labor certification filings suspended by the Department of Labor.
Cloudera
A data software firm that is currently subject to a Department of Labor suspension regarding its PERM filing privileges.
The details
Investigators uncovered potential abuses by inspecting physical workplaces to confirm business activity. Some offices linked to hundreds of petition approvals appeared to be entirely inactive during site visits. As part of the response, the Department of Labor has suspended PERM filings for Cognizant and Cloudera.
Timeline
August 2026: Investigators visited company locations in Dallas.
September 2026: Inspector General D'Esposito announced the fraud investigation.
Money Landscape
This probe represents a significant shift in oversight for the H-1B visa program, which serves as a major pipeline for foreign professional labor. It departs from previous reliance on paper-based compliance by using physical site inspections to verify employer legitimacy.
If you are a worker in an industry heavily reliant on H-1B talent, expect potential delays or changes in hiring processes as companies navigate stricter compliance requirements. Discuss any concerns regarding your own visa or labor status with a qualified legal or immigration professional.
The takeaway
The federal government is intensifying its focus on systemic fraud within foreign-labor sponsorship, which may force firms to change how they document office activity. Keep an eye on your company’s compliance filings or public disclosures if you are employed through a visa-sponsorship program.
Further reading
For more on the federal rules governing foreign-labor programs, visit our Employment section.
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Should the federal government increase scrutiny of H-1B visa programs to better protect U.S. workers?
