VZCZCXRO5322
RR RUEHCD RUEHGD RUEHHO RUEHNG RUEHNL RUEHRD RUEHRS RUEHTM
DE RUEHMC #0201/01 1481702
ZNR UUUUU ZZH
R 281702Z MAY 09
FM AMCONSUL MONTERREY
TO RUEHC/SECSTATE WASHINGTON DC 3743
INFO RUEHME/AMEMBASSY MEXICO 4808
RUEHXC/ALL US CONSULATES IN MEXICO COLLECTIVE
RUEHGT/AMEMBASSY GUATEMALA 0052
RUEHDG/AMEMBASSY SANTO DOMINGO 0026
RUCPDOC/DEPT OF COMMERCE WASHINGTON DC
RUEHC/DEPT OF LABOR WASHINGTON DC
RUEFHLC/DEPT OF HOMELAND SECURITY WASHINGTON DC
RUEHNE/AMEMBASSY NEW DELHI 0024
RUEHMC/AMCONSUL MONTERREY 9327

UNCLAS SECTION 01 OF 04 MONTERREY 000201 
 
SIPDIS 
 
C O R R E C T E D C O P Y (CHANGED ACTION ADDEE) 
 
DEPT FOR CA/VO AND CA/FPP 
DHS FOR USCIS 
DOL FOR ITA, FRAUD DETECTION AND PREVENTION DIVISION 
NEW DELHI PLEASE PASS CONSTITUENT POSTS 
 
E.O. 12958: N/A 
TAGS: CVIS KFRD ELAB MX
SUBJECT: MISREPRESENTATIONS BY STAFFING AGENCIES UNDER THE H-2B 
TEMPORARY WORKER PROGRAM 
 
MONTERREY 00000201  001.4 OF 004 
 
 
¶1.  Summary/Action Request.  Post has identified a growing trend 
in which staffing agencies are petitioning increasing numbers of 
H-2B temporary worker visas for needs that are neither temporary 
nor seasonal, but year-round.  Such action a) introduces 
multiple opportunities for fraud and abuse, b) ultimately 
dilutes the benefits of this program for both H2B employers and 
their beneficiaries, and c) disadvantages U.S. workers who might 
want to compete for these jobs.  Action request for VO guidance 
on temporariness and staffing agencies in paragraph thirteen. 
This cables has been coordinated with other H-2B issuing posts 
in Mexico.   End Summary/Action Request. 
 
 
 
BACKGROUND 
 
 
 
¶2.  Additional personnel and resources from H&L Anti Fraud Funds 
have enabled FPU to conduct more thorough verification of 
information on petitions prior to applicants arriving for 
interviews.  The information provided by USCIS officers who 
participated in the H2 Anti-fraud conference in Guatemala in 
September 2008 and a visit to USCIS California Service Center 
gave officers and LES a clearer understanding of how the labor 
certification and petition adjudication process is intended to 
function.  Officials in both CIS and DOL have asked post to 
exchange information from interviews with returning workers and 
this cable is a part of the information sharing process. 
 
 
 
¶3.  Since February 1, 2009 post has found more than 60 cases in 
which H2B petitions had to be sent back to USCIS with requests 
for revocation.  The information below pertains to one of the 
most common types of fraud, that committed by staffing agencies 
falsely claiming that their need for workers is temporary or 
seasonal. 
 
 
 
THE WORK OF TEMPORARY STAFFING AGENCIES 
 
 
 
¶4. Temporary staffing agencies petition for H2B temporary 
workers in order to contract them out to other firms.  Staffing 
agencies advertise themselves as a "one stop shop" for clients 
that prefer not to recruit workers abroad or navigate the H2B 
petition process themselves.  Because staffing agencies 
typically retain the H-2 beneficiaries in their employ and "rent 
them out" to client firms, they relieve those clients of all the 
administrative work and financial responsibilities required of a 
direct employer. In return for supplying a temporary workforce, 
the staffing agency charges its clients a premium over the wage 
authorized by the Department of Labor.  The majority of H2B 
petitions received in Monterrey are for either common 
construction laborers or landscape laborer that list a salary as 
between $8 - 11 US/hour depending on the location the work is 
being performed.  The margin between what the end user pays the 
staffing agency and what the staffing agency pays the 
beneficiaries represents the staffing agency's gross income. 
 
 
 
WHEN TEMPORARY AND SEASONAL IS NOT 
 
 
 
¶5.  Under the H2-B program, a petitioner's need for temporary 
workers must not be ongoing or continuous.  In the case of a 
staffing agency, the need for work performed for the end user 
might be temporary and seasonal, but the need of the staffing 
agency is not, as  it provides labor year round to anybody who 
will contract it.  Post has found that petitions from staffing 
agencies often overlap to cover an entire year, shifting among 
multiple company names and with a variety of justifications of 
dubious credibility.  Since many such staffing agencies publicly 
advertise year round availability even on short notice, it would 
 
MONTERREY 00000201  002.4 OF 004 
 
 
appear that the job descriptions and locations submitted in 
their petitions are at best informed guesses.  Their business 
model often stands in stark contrast to the DOL requirement that 
petitioners specify the kind of work to be performed and the 
location where it will be performed. DOL's Foreign Labor 
Certification Training and Employment Guidance Letter number 
21-06 states, "when the job opportunity requires work to be done 
at multiple locations either within the jurisdiction of the 
State Workforce Agency (SWA) or within the metropolitan 
statistical area (MSA) that covers multiple SWA's, the 
application must include the names and physical addresses of 
each location."  Post understands the purpose of this rule is to 
provide the ICE, DS, and DOL-OIG the opportunity to conduct 
unannounced inspection at authorized job sites as listed by the 
petitioner.  Post has seen multiple petitions approved this year 
in which the worksite locations were not specified. 
 
 
 
TRUTH IN PETITIONING 
 
 
 
¶6.  Staffing agencies overwhelmingly petition for the lowest 
paying labor categories defined by the DOL, regardless of the 
work to be performed.  While all petitioners have a financial 
incentive to do so, staffing agencies truly do not know how 
their beneficiaries will ultimately be employed, and so choose 
the most unskilled and labor categories available, such as 
landscaper or general laborer.  Meanwhile, agencies advertise on 
websites that workers that can "lead crews" and perform 
"specialized skills."  It also seems likely that staffing 
agencies are aware that demand for H2B workers has long 
outstripped the annual supply made available by Congress, and so 
strive to secure as many H2B visas as they can, regardless of 
actual, contracted needs. 
 
 
 
THE LAW OF UNINTENDED CONSEQUENCES 
 
 
 
¶7.  Many businesses with temporary and seasonal needs are 
willing to enlist the services of a staffing agency and pay for 
the services described in paragraph (4).  If the H2B program was 
not limited by the annual cap of 66,000 visas per year, this 
would be an understandable business decision.  However, given 
the annual cap on H2B visas, staffing agencies have a financial 
incentive to petition as many H2B beneficiaries as they can, 
with or without actual contracts of employment, with the 
intention of "flipping them," that is, seeking new contracts not 
disclosed on the original petition.  Additionally, the agencies 
then seek extensions of the workers' visas from USCIS, and keep 
them gainfully employed among shifting job sites as much as 
possible, regardless of the terms of the original petition.  As 
evinced by the number of businesses every year who fail in their 
attempt to petition H2B workers before the cap is reached, 
staffing agencies force out many business who would otherwise 
participate directly in the H2B program.  There is little doubt 
that some of these businesses are then driven to work with and 
pay a premium to the staffing agencies who managed to get their 
petitions approved first, often via fraudulent claims. 
 
 
 
CASE STUDY I: GB CAPITAL 
 
 
 
¶8.  GB Capital is listed in Lexus Nexus as an investment 
consulting business in St. Charles, Missouri.  They describe 
themselves as a "Hospitality Service" in petition WAC0903850043 
and EAC0904451724.  Monterrey's FPU investigation determined 
that GB Capital does not own or operate any hotels or 
hospitality-related operations.  Monterrey noted that the 26 
applicants applying with GB Capital to serve as housekeepers for 
the Intercontinental Hotel in Kansas City were male and only 
needed for two months according to the petition.  In 
 
MONTERREY 00000201  003.4 OF 004 
 
 
investigating GB Capital further, it was discovered that in 
petition EAC0904451724 the company had again petitioned male 
applicants to perform maid services for the Hyatt Regency in 
Tampa Bay, FL for a shorter period than most petitions. 
 
 
 
¶9.  (SBU)  FPU Monterrey contacted the human resource (HR) 
manager of the Intercontinental Hotel in Kansas City.  The 
manager confirmed the hotel had a relationship with GB Capital, 
but that it had not recently requested workers nor was the hotel 
expecting any additional workers.  The hotel was actually 
releasing staff due to the local economic conditions.  FPU also 
contacted HR manager at the Hyatt Regency in Tampa Bay, FL.  The 
manager confirmed the Hyatt  had no relationship with GB 
Capital.  The manager also stated the hotel was not requesting 
any workers.  In both cases, the managers informed FPU that 
their hotels do not employ male housekeepers.  The visa 
applications were refused under Section 221g and post sent the 
petitions WAC0903850043 back for revocation consideration.  No 
applicants for petition EAC0904451724 applied in Monterrey. 
Monterrey shared information about this petition with Embassy 
Santo Domingo; officers there refused applicants for GB Capital 
on this petition under Section 221(g). 
 
 
 
¶10.  Weeks later, the applicants refused in Monterrey arrived 
along with others in Mexico City to apply for visas under a new 
petition filed by Ambassador Seasonal Concepts, petition number 
EAC0904450718.  FPU investigation confirmed that an owner at 
Ambassador Seasonal Concepts is married to a manager at GB 
Capital.  Monterrey and Mexico City FPMs coordinated during the 
adjudications and the visas were not issued. 
 
 
 
FRAUD CASE STUDY II:  WORKFORCE PLUS (DBA THE ACCENT GROUP) 
 
 
 
¶11.  One of the most egregious cases of staffing agency 
misrepresentation can be found in a petition EAC0813150959 filed 
by Workforce Plus LLC from Baton Rouge, Louisiana.  Workforce 
Plus, which also files under the name The Accent Group, filed a 
petition for 150 workers to perform electric substation repair 
work in Louisiana.  This petition was approved in April 2008. 
Prior to the arrival of 26 applicants to for interview in 
Monterrey March 5, 2009, post's FPU contacted a representative 
of Workforce Plus who confirmed the workers were going to work 
as substation repairman for a client named Irby Construction 
Company (ICC).  Further research revealed that ICC is owned by 
the mother-in-lawn of the owner of Workforce Plus. 
 
 
 
¶12.  The beneficiaries of this petition stated that they were 
returning workers, destined for Money Hill Golf and Country Club 
in Baton Rouge LA.  A representative at that club confirmed to 
FPM in a phone conversation that the club had contracted with 
Workforce Plus to provide the group of workers for a flat fee of 
US $9000, and were awaiting their arrival.  There was no 
sub-station work, nor were the workers qualified or experienced 
to conduct such work.  The visa applications were refused 214b 
on March 5, 2009 and post subsequently sent the petition back 
for revocation.  A golf club representative told FPM that the 
club used Workforce Plus because the I-129 petition it had filed 
with USCIS was not processed because the H2B cap had already 
been met. 
 
 
 
ACTION REQUEST 
 
 
 
¶13.  Post requests assistance from VO/L/A in clarifying with DOL 
on the question of temporariness of need as it applies to 
staffing agencies.  DOL officials told conoffs both at the 
 
MONTERREY 00000201  004.4 OF 004 
 
 
Guatemala conference and in the March 3 teleconference that in 
order for a staffing agency to obtain labor certification for 
temporary workers, the staffing agency itself must have a 
temporary or seasonal need for the workers.  The temporariness 
or seasonality cannot be based on the needs of the staffing 
agencies client companies.  However, post has seen a number of 
petitions similar to the examples described above in which labor 
certifications and subsequent I-129 petitions for H2B workers 
for year round staffing agencies have been approved. 
WILLIAMSON