The company will pay a fine of around $566,000 before sentencing, according to the court. Wright State agreed in November to settle its part in the federal investigation into its H-1B visa misuse for $1 million.
“Today’s guilty plea marks the successful culmination of a complex visa-fraud investigation by HSI and our partners,” said Vance Callander, Special Agent in Charge for Homeland Security Investigations in Michigan and Ohio. “This outcome should serve as a stark warning to entities who may be seeking to exploit the U.S. Visa process.”
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Vallabhaneni was unavailable to comment, a Web Yoga employee told the Dayton Daily News when reached by phone.
Ralph Kohnen, an attorney at Taft, Stettinius & Hollister representing Web Yoga, said his client failed “to timely report after they discovered the criminal conduct of others.” He declined to comment further on the case.
During the summer of 2010, an official with Wright State approached Web Yoga and proposed an arrangement whereby the university would source H-1B visa holders from overseas and subcontract them to Web Yoga for placement at client locations around the country, according to the DOJ.
Between 2010 and 2013, WSU entered into sponsored research contracts with Web Yoga. Wright State employed software engineers, obtained H-1B visas for the employees, and paid their respective salary and benefits as employees of the university, according to the DOJ.
The H-1B visa program allows companies in the United States to temporarily employ foreign workers in occupations that require highly specialized knowledge and a bachelor’s or higher degree in a specific specialty. Wright State was sometimes “exempt” from a cap limiting the number of H-1B visas it could obtain, unlike other types of organizations.
Wright State employed 24 foreign employees who were selected and approved by Web Yoga through H-1B visas, according to the DOJ. Web Yoga learned in 2012 that portions of the H-1B visa paperwork filed by Wright State with the federal government did not accurately reflect the work locations for the visa holders subcontracted to the company.
Web Yoga learned the university falsely stated the employees would be physically working on the university’s campus. The visa employees worked as consultants on behalf of Web Yoga in various cities throughout the country, including Atlanta, Orlando and New York City, according to the DOJ.
“Web Yoga Inc. conspired to conceal its use of Wright State University’s employees authorized through the H-1B visa program to work in the U.S…We will continue to work with our law enforcement partners to investigate crimes that abuse Department of Labor programs and deprive American workers of employment opportunities,” said Irene Lindow, Special Agent-in-Charge, Chicago Region, U.S. Department of Labor Office of Inspector General.
Despite its connection to the visa fraud probe at Wright State, Web Yoga continues to benefit from the H-1B visa program. So far in 2019, the company had around 10 H-1B workers approved, according to the H-1B employer data hub from U.S. Citizenship and Immigration Services.
“The H-1B program is widely abused and exploited by employers to import cheap indentured foreign guestworkers. Instead of enforcing the law to its fullest extent, the U.S. government has looked the other way, failing to act even when US workers are laid off and replaced by H-1B workersm,” said Ron Hira, an immigration expert and associate professor of public policy at Howard University. “The Wright State-Web Yoga conspiracy was so blatant that the government was forced to act, but the punishments are a slap on the wrist and won’t deter program abuse.”
The Dayton Daily News has reached out to a spokesman with the U.S. Department of Labor about Web Yoga’s continuing approval for H-1B visas.
Wright State’s role in the visa investigation ended last year when it reached a settlement, spokesman Seth Bauguess said via email.
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The U.S. Attorney’s Office in November agreed not to pursue civil or criminal prosecution of Wright State since the university agreed to pay $1 million in three installments over two years. WSU also agreed to cooperate in any additional investigations stemming from the federal probe.
“Since 2015, Wright State has thoroughly addressed and corrected the issues raised by the H-1B investigation,” Bauguess said. “Over the last four years, the university has made sweeping changes and has strengthened the university by implementing compliance and transparency reforms that are helping Wright State move forward with fulfilling its educational and research mission.”
Wright State’s deal included “any crimes related to the conspiracy to commit visa fraud from at least December 2010 through 2015,” according to the non-prosecution agreement. The crimes included but were not limited to money laundering, perjury, “fraud and misuse of visas, permits and other documents,” and “conspiracy to defraud the United States.”
When the federal investigation came to light in 2015, it led to four administrators being suspended. University researcher Phani Kidambi, general counsel Gwen Mattison, provost Sundaram Narayanan and senior adviser to the provost Ryan Fendley were all suspended in 2015.
Mattison agreed to retire in August 2015 with a $301,331 separation payment, Kidambi resigned in August 2017, and the university fired Narayanan and Fendley.
“These employees fell well short of our high standards, which is why we held them accountable,” Doug Fecher, then-board of trustees chairman said at the time. “We have made sweeping changes in how we handle H-1B visas and strengthened this university by implementing compliance reforms and transparency since the United States Attorney’s Office notified us of these issues.”
Dayton Daily News Reporter Josh Sweigart contributed to this story.
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