The United States government has opened a sweeping investigation into alleged fraud within the H-1B and PERM work visa programs, marking one of the most aggressive federal crackdowns on employment-based immigration abuse in recent years. The probe, confirmed on July 8, 2026, has already named Indian IT giant Cognizant among the companies facing scrutiny.

What Triggered the Investigation

The investigation is being led by the Office of Inspector General (OIG) under the US Department of Labor, operating as part of the Task Force to Eliminate Fraud, an initiative headed by Vice President JD Vance. According to Labor Department Inspector General Anthony D’Esposito, the OIG has uncovered widespread schemes involving:

• Fraudulent visa applications submitted by employers and labor brokers
• Coercive wage-kickback arrangements that exploit foreign workers
• Below-market wage practices designed to undercut American job seekers

Speaking to Fox Business, D’Esposito described the effort as “probably the most aggressive action against foreign labor fraud” undertaken by an inspector general, adding that his office has “already started to issue dozens of subpoenas” and intends to “track down every lead.”

Why Cognizant Is in the Spotlight

D’Esposito specifically referenced Cognizant while discussing whistleblower reports, noting that the company has been part of the ongoing “chatter” surrounding PERM and H-1B visa issues. It is important to note that no formal charges have been filed against Cognizant, and being named in this context does not itself constitute evidence of wrongdoing.

Government data adds context to the scrutiny: in the second quarter of 2026 alone, Cognizant reportedly had approximately 3,440 H-1B visas certified, reflecting the company’s heavy reliance on the program as one of the largest users of Indian IT talent in the United States.

A Shift Toward Proactive Enforcement

This investigation signals a broader policy shift in how the US government oversees employment-based visa programs. Rather than relying solely on complaint-driven reviews, the administration has adopted a “Secretary-certified” audit model, which allows the Secretary of Labor to initiate audits based on “reasonable cause” alone, without waiting for a formal complaint.

This change lowers the threshold for federal scrutiny considerably. Employers can now expect:

• Unannounced site visits
• Reviews of online job postings and company presence
• Increased risk of removal from the H-1B program for non-compliance
• Potential civil penalties and, in severe cases, criminal charges

Multi-Agency Involvement

The probe is not limited to the Department of Labor. It involves a coordinated effort with the Department of Homeland Security (DHS) and the Department of Justice (DOJ), underscoring the seriousness with which the administration is treating allegations of visa fraud and labor exploitation, which officials have also linked to broader concerns about human trafficking networks tied to foreign labor arrangements.This cross-agency collaboration signals stronger data-sharing and faster enforcement actions against violators nationwide

What This Means Going Forward

For companies that heavily sponsor H-1B and PERM visas particularly large IT services firms — this investigation is likely to mean tighter compliance requirements, more documentation scrutiny, and closer monitoring of wage practices. For foreign workers on these visas, the crackdown is framed by officials as an effort to protect them from exploitative practices, including wage kickbacks and coercive employment terms.

As subpoenas continue to be issued and the investigation unfolds, more companies could be named in the coming weeks. This is a developing story, and further regulatory action or formal charges may follow as the OIG’s findings progress.

Disclaimer: This article is based on publicly available statements from US Department of Labor officials as of July 9, 2026. No formal charges have been filed against any named company at the time of writing.

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