Sowrabh Sharma (33), owner of IT Staffing companies SCM Data Inc. and MMC Systems Inc. pleaded guilty yesterday before U.S. District Judge Kevin McNulty in Newark federal court for using phony documents to fraudulently obtain H1-B visas for foreign workers and submitting false tax returns.
According to U.S. Attorney Carpenito:
“For years, Sharma and others working at SCM Data and MMC systems lied about hiring full-time foreign workers in order to secure H1-B visas.”
“In reality and contrary to immigration laws, these workers were often ‘benched’ without pay while the companies created false documents to cover-up the scheme.”
The H1-B visa fraud investigation conducted over a period of three years resulted in conviction/indictment of others including some of the employees of SCM Data Inc. and MMC Systems Inc. and an immigration attorney from Virginia.
Hiral Patel (HR Manager) of SCM Data Inc. and MMC Systems Inc. and Sunila Dutt of Ashburn, VA (Immigration Attorney) have previously pleaded guilty to charges of obstruction of justice and visa fraud.
And, Shikha Mohta of Jersey City (Head of Finance), and Hari Kanne of India (Immigration Manager) of SCM Data Inc. and MMC Systems Inc. were previously named as co-conspirators in H1-B Visa fraud scheme by the U.S. Attorney for District of New Jersey.
According to the court documents and statements:
SCM Data Inc. and MMC Systems Inc. offered consultants to clients in need of IT support. Both companies recruited foreign nationals with purported IT expertise, often student visa holders or recent college graduates, and sponsored them for H-1B visas with the stated purpose of working for SCM Data and MMC Systems’ clients throughout the United States.
Sharma admitted today that from 2010 through April 2015, he and others falsely represented to U.S. Department of Homeland Security, U.S. Citizenship and Immigrations Services (USCIS) that dozens of foreign workers had full-time “in-house” positions, and would be paid an annual salary, as required to secure the visas. However, Sharma and his companies only paid the foreign workers when they were placed at a third-party client, or a company that entered into a contract for services with SCM Data and MMC Systems.
Employee Wage and Tax Fraud
Besides pleading guilty to using phony documents for obtaining H1-B visas, Sowrabh Sharma of SCM Data Inc. and MMC Systems Inc. admitted to wage and tax fraud as well.
The court documents indicate that:
..in some instances, foreign workers who were “benched” between projects and not working were told that if they wanted to maintain their H-1B visa status, they would need to come up with what their gross wages would be in cash and give it to SCM Data and MMC Systems to generate phony payroll checks.
Also, as per Sowrabh Sharma’s guilty plea, he intentionally overstated and claimed false expenses pertaining to SCM Data and MMC Systems on his individual tax returns for 2011, 2012, 2013, and 2014.
The false expenses and fraudulent tax returns according to the case filings resulted in a loss of approximately $1,114,824 to the United States government.
Penalty for H1-B Visa Fraud
Sowrabh Sharma of SCM Data Inc. and MMC Systems Inc. faces a maximum potential penalty of five years on the visa fraud conspiracy count and three years in prison on the tax fraud count respectively.
In addition to the prison time, both H1-B visa and tax fraud charges carry a maximum fine of $250,000.
Sowrabh Sharma’s sentencing is scheduled for May 30, 2018.