Non-immigration visa fraud: proposals to end the misuse of the L visa by transnational criminal organizations as a method of illegal immigration.

AuthorMcCallen, Amy

    In the 1997 novel The Wrath of God, Chinese entrepreneur Sun Qi escapes to the United States and forms the Pan-American Investment Group.(1) This business specializes in the mass production of forged documents: work records detailing at least two years of management experience, business licenses, certificates confirming the applicant has no criminal record, and university diplomas.(2) The firm charges each client twenty thousand dollars for a set of these documents that qualify the alien for an L-1 non-immigrant visa.(3) In this Chinese novel, a lawyer working with the Pan-American Investment Group explained that using the L visa as a tool for illegal immigration to the United States is big business:

    We spend no more than 2,000 U.S. dollars on each applicant. For each new immigrant we can make 18,000 U.S. dollars, which means 180,000 U.S. dollars for ten, 1.8 million U.S. dollars for 100. How much can 10,000 or 100,000 bring in? ... With an input-output ratio of one to ten, what other business has a profit margin higher than this?(4) Congress created the L visa in 1970 to encourage international companies to transfer foreign talent and investment to the United States.(5) These multinational businesses needed a quick and flexible method to transfer business personnel to the United States.(6) However, in attempting to meet the legitimate needs of transnational companies, Congress unintentionally crafted a malleable visa vulnerable to fraud.(7)

    Although fictional, The Wrath of God accurately depicts how transnational criminal organizations exploit the provisions of the L-1 non-immigrant visa as a method for illegal immigration. The problem in China is especially severe; government investigations have revealed that in some provinces, between eighty and ninety percent of all L visa applications are fraudulent, and many are from companies that only exist on paper.(8)

    In May 1997, Congress examined the "notoriously porous" L visa in a series of hearings on visa fraud before the Subcommittee on Immigration and Claims.(9) In his opening statement, Chairman Lamar Smith stated that visa fraud posed "severe and increasing risks to the integrity of our immigration system."(10)

    This Note examines why the L visa is particularly vulnerable to multinational fraud and proposes both a domestic and an international solution to combat this abuse. Part II of this Note addresses the governmental policies behind the L visa. This section provides an overview of the origins of the transnational company and discusses the reasons why Congress created the L visa to meet the needs of this specialized segment of international business.

    Part III analyzes the bifurcated approval process for an L visa. This section surveys the requirements for the L visa and discusses why Congress believed these requirements were an adequate safeguard against abuse. Part III also examines why the traditional check on the immigration process, consulate review, is largely ineffective to detect and deter fraudulent L visa applications.

    Part IV of this Note analyzes how transnational criminal organizations, most notably Russian and Chinese units, use the L visa as a method of illegal immigration. This section details the prototypical L visa scheme and discusses how criminal organizations exploit the flexible provisions of the L visa to perpetuate these fraudulent practices.

    Part V proposes a two-part solution to L visa fraud. First, the INS and the State Department need to close existing loopholes in the L visa through better methods of detection of criminal applicants and punishment of offenders. Second, the United States should sign a Mutual Legal Assistance Treaty with both Russia and China. This treaty would allow the United States to work together with these countries to eliminate the organized criminal networks perpetuating these large-scale fraud schemes.


    Traditional U.S. immigration policy has sought to protect the U.S. worker by severely limiting employment opportunities for foreign nationals.(11) However, the growing importance of transnational corporations challenges this philosophy.(12) Transnational companies need a flexible immigration policy to allow for critical interaction between company employees and the immediate transfer of personnel to adjust to shifting labor patterns.(13) Because of the increasing significance of the multinational company, the proper goals for U.S. immigration policy must be re-examined within the context of the international business climate.(14) An unduly restrictive business immigration system could severely limit the ability of U.S. companies to compete in the global marketplace.

    1. The Importance of the Transnational Company in the International Business Community

      The Transnational Corporation (TNC) is a multinational organization with a unified structure, collective control, and a common strategy.(15) The TNC is largely the product of the post World War II economy and its emergence has led to a revolution in business patterns and a high level of globalization in the world economy.(16) TNCs account for about eighty percent of United States international trade, of which approximately forty percent is intracompany trade.(17) Globalization is now recognized as a "critical component for any new business.(18) Therefore, the importance of TNCs can only be expected to increase.

      TNCs engage in a different type of business transaction than traditional international businesses.(19) The conventional international business deal, between two separate companies incorporated in different countries, involves a one time transaction at the border.(20) In contrast, TNCs presuppose a long term relationship with the host country.(21) Because of continuous contact with the host country, TNCs require different instruments for business transactions, trade, and monetary matters.(22)

    2. The Conflict Between Transnational Companies and Traditional U.S. Immigration Policy

      To achieve success in a global economy, multinational corporations must have the ability to move personnel freely within their organizations.(23) Putting the best manager or the most expert technician in the right branch of the TNC, "is an absolute requirement to assure that a business stays even with, or ahead of well-financed and highly efficient overseas competitors."(24) A flexible immigration policy allows the company to attract the best employees by promising advancement within the organization without regard to nationality.(25)

      A favorable business immigration system also permits a company to fill positions caused by temporary labor shortages in any one country.(26) This need is particularly evident in the science and technology industries, as approximately fifty percent of graduates of Ph.D. programs at U.S. universities are foreign nationals.(27) One business commentator has noted that "it is virtually impossible to adequately staff a major ... corporate research facility without recruiting foreign nationals from U.S. universities or directly from abroad."(28)

      Furthermore, the international exchange of personnel leads to a cross-fertilization of ideas among highly skilled employees. Penetrating a foreign market requires employees with specialized knowledge of the customs and preferences of the people who comprise that market.(29) Through contact with foreign workers, U.S. employees gain a better understanding of the various cultures of the international market.(30) The foreign employee returns to his home country with a positive impression of the United States and an increased knowledge of the methods, procedures, and culture of the company or firm.(31)

      The need of multinational businesses to freely transfer personnel between offices directly conflicts with established U.S. immigration policy. This policy has, in an effort to protect the unemployed U.S. worker, sought to discourage U.S. companies from hiring foreign individuals.(32) Most significantly, in order to hire a foreign worker, most U.S. companies have in the past had to satisfy a cumbersome labor certification process through the Department of Labor and prove that no qualified U.S. workers were available for the position.(33)

      This restrictive policy acted as a trade barrier, severely hindering the ability of U.S. companies to attract talented foreign workers and limiting the opportunities for foreign companies wishing to establish branch offices in the United States.(34) As one commentator noted, the

      [b]usiness community can do little to control exchange rates or the extent of foreign government restrictions on trade, but it must do all it can to assure efficiency in business operations and the optimal dedication of personnel resources to respond to market demands ... [C]ompanies need immigration laws that provide maximum flexibility in planning and minimum time delays.(35) Before 1970, the United States lacked a flexible program that would allow businesses to bring foreign personnel to this country to occupy temporarily a significant position within the corporation or to start a new branch of a foreign parent company.(36) Instead, the foreign national had to qualify under the rigid standards of either the H or the J visa.(37) Neither was particularly suited to the needs of the TNC.(38)

      The H visa allows a company to transfer an employee to this country for a limited period of time to occupy a temporary position.(39) However, this visa strictly defines "temporary position" as one with a definite starting and ending date.(40) For example, a foreign national could not "temporarily" occupy a permanent position such as Chief Executive Officer or Vice President. These restrictions limited the ability of the TNC to fill vacant positions with available employees.(41)

      The second option, the J visa, is not a viable alternative for a TNC.(42) The J visa is designed to bring "exchange visitors" to the United States.(43)...

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