Employers and labour brokers submitted fraudulent applications and coerced workers into wage-kickback schemes
Across decades, the promise of the H-1B visa has rested on a delicate compact: that foreign talent fills genuine gaps, and that workers who cross oceans in pursuit of opportunity are treated with dignity. Now, the United States Department of Labour has opened a formal investigation suggesting that compact may have been systematically betrayed — with Cognizant among the firms named — as whistleblowers describe wage-kickback schemes, coercion, and patterns that federal authorities are now characterizing not as paperwork violations, but as labour trafficking. The probe, operating under a Trump administration task force led by Vice-President JD Vance, signals that Washington is prepared to treat the exploitation of foreign workers as a matter of criminal gravity, with consequences that may fundamentally alter how the technology and consulting industries recruit across borders.
- The US Department of Labour's inspector general has issued dozens of subpoenas after whistleblowers named firms 'like Cognizant' in connection with alleged H-1B and PERM visa fraud schemes.
- Foreign workers at the centre of the investigation are accused of having been coerced into wage-kickback arrangements — effectively paying back portions of their salaries — under threat of losing their visa status.
- The scope of alleged misconduct has expanded far beyond administrative irregularities, with federal authorities now invoking the language of labour trafficking and forced labour.
- Cognizant's H-1B labour condition applications collapsed by 66% between 2018 and 2025, a contraction that raises questions the company has so far declined to answer publicly.
- A dedicated White House task force under Vice-President Vance is coordinating enforcement across agencies, signalling that this investigation is a political as well as legal priority.
- The outcome of this probe is expected to reshape visa sponsorship practices across the technology and consulting sectors for years to come.
The United States Department of Labour has launched a formal investigation into alleged fraud within the H-1B and PERM employment visa programmes, with Cognizant explicitly referenced by the agency's inspector general, Anthony D'Esposito, in connection with the probe. Speaking publicly, D'Esposito confirmed that his office has already issued dozens of subpoenas and is actively pursuing whistleblower complaints describing what officials characterise as systematic abuse of the employment-based visa framework.
The timing is notable. Labour Department records show Cognizant submitted more than 10,000 labour condition applications — the filings required before sponsoring foreign workers — in 2018. By 2025, that figure had fallen to roughly 3,400, a decline of nearly two-thirds. The company did not respond to requests for comment.
The investigation operates under a broader enforcement mandate shaped by the Trump administration. Vice-President JD Vance has established a dedicated task force targeting fraud within these visa programmes, and the Labour Department's probe falls within that remit. The alleged misconduct described by the agency goes well beyond administrative errors: employers and labour brokers stand accused of submitting fraudulent applications, forcing foreign workers into wage-kickback schemes, and deliberately undercutting American workers through below-market pay.
Perhaps most significantly, federal authorities have begun framing the alleged abuses not as technical violations but as labour trafficking and forced labour — a characterisation that carries far graver legal and moral weight. The Labour Department has stated that these visa programmes exist to address genuine domestic labour shortages, not to enable exploitation.
What this investigation ultimately produces — and how far it reaches — is likely to force a reckoning across the technology and consulting industries over how they have long relied on foreign labour pipelines.
The United States Department of Labour has opened a formal investigation into fraud within the H-1B and PERM employment visa programmes, with Cognizant among the companies named in connection with the probe. Anthony D'Esposito, the Labour Department's inspector general, disclosed that his office has received whistleblower complaints specifically referencing firms "like Cognizant" in relation to these visa systems. Speaking to Fox Business, D'Esposito confirmed that the Office of Inspector General has already distributed dozens of subpoenas and is actively pursuing leads tied to what officials describe as systematic abuse of the employment-based visa framework.
The investigation arrives at a moment when Cognizant's reliance on the H-1B programme has contracted sharply. Labour Department records show the company submitted 10,189 labour condition applications in 2018—the formal filings employers must complete before sponsoring foreign workers for H-1B visas and certifying compliance with wage and labour standards. By 2025, that number had fallen to 3,436, a decline of roughly two-thirds. When contacted for comment, Cognizant did not respond before publication.
The probe represents a significant escalation in the Trump administration's enforcement agenda around employment visas. Vice-president JD Vance has established a task force specifically focused on eliminating fraud within these programmes, and the Labour Department's investigation operates under that broader mandate. The Office of Inspector General has outlined the scope of alleged misconduct extending well beyond paperwork violations. According to the agency, employers and labour brokers are accused of submitting fraudulent visa applications, coercing foreign workers into wage-kickback schemes, and deliberately undercutting American workers through below-market compensation.
The allegations carry weight beyond wage disputes. The Labour Department has identified patterns suggesting labour trafficking, forced labour, and systematic exploitation of foreign nationals. These characterizations mark a significant departure from treating visa fraud as a technical or administrative matter. The agency has stated plainly that the H-1B and PERM programmes exist to address genuine labour shortages in the United States economy—not to enable fraudulent hiring practices or worker exploitation.
The investigation signals a hardening stance on how these visa systems operate in practice. For years, critics have argued that the programmes function as a mechanism for depressing wages and displacing American workers, while companies have maintained they use them to fill positions they cannot staff domestically. The Labour Department's current enforcement push suggests federal authorities are now treating allegations of systematic abuse as a priority warranting coordinated action across multiple agencies. What emerges from this investigation—and how aggressively it is pursued—will likely reshape how major technology and consulting firms approach their hiring practices and visa sponsorships in the years ahead.
Citas Notables
Whistleblower complaints have referred to companies like Cognizant in connection with H-1B and PERM programmes— Anthony D'Esposito, Labour Department Inspector General
The H-1B and PERM programmes are intended to address genuine labour shortages, not facilitate fraudulent hiring practices— US Department of Labour
La Conversación del Hearth Otra perspectiva de la historia
Why does Cognizant specifically matter here? They're one company among many that use H-1B visas.
They're named because whistleblowers have flagged them. But the real significance is the scale—they went from filing over 10,000 visa applications a year to about 3,400. That's not a gradual shift. That's a dramatic pullback.
Could that pullback mean they cleaned up their practices, or does it suggest something else?
It could mean either. But the timing matters. This investigation is happening now, under a new administration with explicit intent to crack down. The decline might reflect Cognizant responding to pressure, or it might reflect that they saw enforcement coming and adjusted course.
The article mentions wage-kickbacks and forced labour. How does that actually work?
A worker gets hired on paper at a certain wage, but then part of that money gets returned to the employer or a broker. The worker ends up with less than promised, and they're often trapped because their visa status depends on that employer.
So the worker can't just leave and find another job?
Not easily. Their visa is tied to that specific employer. If they leave, they lose legal status. That's the coercion mechanism. It's why the Labour Department is now calling this labour trafficking.
What happens to Cognizant if the investigation finds wrongdoing?
That depends on what's proven and how the administration chooses to enforce it. Fines, certainly. Restrictions on future visa sponsorships. Possible criminal charges for individuals involved. But the broader question is whether this investigation becomes a template for how the government treats other major visa users.