TLDR:
- The U.S. Department of Labor’s Office of Inspector General has opened a nationwide investigation into alleged fraud in the H-1B and PERM visa programs, issuing dozens of subpoenas as part of a multi-agency effort tied to the administration’s Task Force to Eliminate Fraud.
- Several large employers, including IT services firm Cognizant, have been named in connection with the probe by a Labor Department official, but no charges or formal findings of wrongdoing have been announced against any company at this stage.
- Employers should review their H-1B and PERM compliance practices now, and current H-1B employees should know that an investigation into their employer does not automatically put their own status at risk.
Why This Investigation Is Getting Attention
If you’ve seen headlines this month about a sweeping new H-1B fraud probe, you’re not imagining the scale of it. On July 8, 2026, the Department of Labor’s Office of Inspector General (OIG) announced a nationwide investigation into alleged abuse of the H-1B and PERM employment-based visa programs. The agency has already issued dozens of subpoenas and is seeking information from whistleblowers regarding alleged abuses by employers and recruitment firms.
For anyone connected to employment-based immigration such as a company that sponsors visas, an HR professional managing a foreign workforce, or an H-1B employee yourself, a headline like this can feel alarming. The good news is that an investigation, even a large and high-profile one, is not the same thing as a finding of wrongdoing. Understanding what’s actually happening, and what it does and doesn’t mean for you, is the first step to responding calmly rather than reactively.
What Changed: Inside the OIG’s Investigation
The investigation is being led by the Department of Labor’s OIG, working in coordination with the White House’s Task Force to Eliminate Fraud. According to the OIG, investigators are examining whether employers and labor brokers manipulated visa programs through fraudulent applications, wage violations and exploitation of foreign workers. The agency has described the schemes under review as including “fraudulent applications, exploit[ation of] foreign workers through coercive wage-kickback arrangements, and undercut[ting] American workers by flooding the market with below-wage labor.”
Labor Department Inspector General Anthony D’Esposito has said the investigation extends beyond any single company, and that leads are being pursued across employers, staffing firms, and labor brokers involved in H-1B and PERM filings. In public comments, D’Esposito named several companies that whistleblowers had mentioned in connection with the inquiry, including IT services firm Cognizant. Importantly, no formal allegations have been filed against the company at this stage, and the OIG’s formal release did not name Cognizant or any other company, the company references so far have come from an official’s remarks in a media interview, not from a charging document.
This investigation also arrives alongside other significant shifts in H-1B policy. A wage- and skill-based selection system replacing the traditional lottery took effect earlier this year, and new signature requirements for USCIS filings are also rolling out. Together, these changes signal a broader push toward tighter scrutiny of how employment-based visas are used; not just a single, isolated enforcement action.
Who This Affects
Employers Who Sponsor H-1B or PERM Cases
Any business that sponsors H-1B workers or files PERM labor certifications for green card cases should treat this as a signal to revisit its compliance posture. The OIG has indicated that large IT outsourcing firms, consulting companies, and staffing agencies could face heightened scrutiny if evidence of systemic issues emerges. That doesn’t mean every sponsoring employer is a target, but it does mean documentation, wage-level accuracy, and job-duty descriptions matter more than ever.
Staffing Firms and Labor Brokers
The investigation specifically calls out labor brokers and third-party placement arrangements, particularly where wage-kickback schemes or below-market pay have been alleged. Companies that place H-1B or green-card-sponsored employees at client sites should be especially attentive to how those arrangements are structured and documented.
Current H-1B Employees
If you hold H-1B status and your employer’s name has come up in connection with this investigation, or any investigation, it’s natural to worry about what happens to you personally. Here’s the key point: an investigation into an employer does not automatically invalidate employees’ visas. Workers who hold valid H-1B status generally continue to remain in lawful status unless their individual petitions are revoked or other immigration issues arise. In other words, your status is tied to your individual approved petition, not automatically to whatever your employer may or may not be facing.
What Could Happen If Violations Are Found
It’s worth understanding what’s actually at stake if an investigation like this does turn up violations, since the consequences vary significantly depending on what investigators find. Possible outcomes for an employer found to have violated program rules include substantial civil penalties, debarment from participating in the H-1B program for a specified period, revocation of approved petitions, enhanced government monitoring, and criminal prosecution in cases involving deliberate fraud or conspiracy. The specific outcome ultimately depends on the findings of the investigation and whether authorities conclude that any violations were administrative, civil or criminal in nature, meaning there’s a meaningful range between a paperwork correction and a criminal case, and most investigations don’t end at the most severe end of that range.
What You Should Do Next
For employers, this is a good moment to conduct a proactive internal review rather than waiting to see what happens. That typically means:
- Auditing current H-1B and PERM files for accuracy in job duties, wage levels, and worksite locations
- Reviewing any third-party placement or staffing arrangements for compliance with Department of Labor wage rules
- Making sure signature and filing practices align with current USCIS requirements
- Establishing a clear internal process for responding to a subpoena or agency inquiry, should one arrive
For H-1B employees, the most useful step is simply staying informed about your own petition status and keeping copies of your approval notices and supporting documentation. If your employer becomes the subject of a formal inquiry, having your own records organized makes it much easier to respond to any questions that may come up, and to work with an attorney quickly if the need arises.
In either case, this is exactly the kind of situation where guessing at the right response, or waiting to see how things unfold, can create more risk than acting early with good guidance.
Staying Ahead of H-1B Visa Enforcement
A nationwide fraud investigation into the H-1B and PERM programs is a significant development, but it’s important to keep it in perspective. Right now, this is an active investigation with subpoenas being issued, leads are being pursued, and companies named in connection with the inquiry, but no employer has been formally charged or found to have violated the law. For employees, individual status generally remains secure unless there’s an issue with your specific petition.
Immigration enforcement priorities can shift quickly, and staying ahead of them is easier with the right guidance. Nobody should navigate immigration alone. Whether you’re an employer trying to get ahead of a compliance review or an employee who wants clarity about where you stand, Berardi Immigration Law can help you understand what this investigation means for your specific situation and what steps make sense next.
Frequently Asked Questions
Does this investigation mean Cognizant or other named companies have committed visa fraud?
No. As of now, no formal charges or findings of wrongdoing have been announced against any of the companies mentioned in connection with the investigation, including Cognizant. The references so far have come from an official’s public remarks about ongoing subpoenas and leads, not from a completed investigation or charging document.
If my employer is under investigation, will I lose my H-1B status?
Not automatically. An investigation into an employer’s practices is separate from the validity of an individual employee’s approved petition. Your status generally remains intact unless your specific petition is revoked or another immigration issue affects your case directly.
What should employers do if they receive a subpoena or inquiry related to this investigation?
Respond promptly and don’t attempt to navigate it alone. Gather the requested documentation carefully, involve legal counsel early, and use the opportunity to review your broader H-1B and PERM compliance practices, since a single inquiry can sometimes surface related issues elsewhere in a company’s filings.
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