Report Uncovers Exploitation of H-1B Visa Lottery by Outsourcing Firms

America's H-1B visa lottery system, crucial for foreign worker employment, is being manipulated by staffing and outsourcing companies, according to a Bloomberg report. In 2023, 446,000 people applied for 85,000 available H-1B visas. The report reveals that over 11,600 visas were awarded to multinational outsourcing companies with vast overseas workforces, and another 22,600 went to IT staffing firms. Nearly half of the H-1Bs analyzed by Bloomberg went to such companies, many of which cheated by submitting multiple entries for the same worker.

From 2020 to 2023, data obtained by Bloomberg shows staffing firms exploited the H-1B lottery system through "multiple registration," submitting several entries for a single individual to increase their chances of securing a visa—a practice USCIS labels as “fraud.” Approximately 15,500 visas, or one in six awarded last year, were obtained through such means.

One particularly egregious case involves Kandi Srinivasa Reddy, an Indian American who started Cloud Big Data Technologies LLC in 2013. Reddy's operation submitted multiple applications for the same individuals under different company names, significantly boosting their chances of being selected. His companies, including Machine Learning Technologies LLC, submitted over 3,000 entries since 2020, securing hundreds of visas. In one year alone, Reddy’s firms accounted for more than 300 successful applications.

After winning H-1Bs, Reddy’s company contracted workers to corporations like Meta and HSBC, collecting 20-30% of the workers’ pay, which could amount to $15,000 or more annually per worker. Lucas Garritson, Reddy’s lawyer, stated that some visas were challenged by USCIS for lottery system abuse, but claimed the agency lacked proper procedures and proof of rule violations.

Originally a first-come, first-served system, USCIS switched to a lottery due to high demand, capping visas at 85,000. The lottery’s overwhelming demand has nearly doubled the applicant pool in recent years, making it increasingly difficult to secure a visa.