Fraud in Labor Certifications Alleged

CHICAGO (CN) - A company stole hundreds of thousands of dollars from more than 500 workers and recruiters by charging them for labor certifications and H-2B visas but failing to deliver the documents or find them any jobs, says a federal class action.

International H-2B/J-1 Work & Travel USA was dissolved when its fraud was exposed, but its former president Louise Merchant manages its successors, IWT International and IWT Staffing, who assumed International's assets to continue defrauding foreign workers, the class says.

According to the complaint, Merchant and International recruited foreign workers to work seasonally in the U.S. through email promotions; they promised, for a fee, to review and prepare the applications, file employer petitions with the federal government for certifications and visas, and find seasonal jobs.

International allegedly collected more than $300,000 in 2008 but failed to deliver the paperwork or jobs to any applicants and misappropriated their money. The class claims International never intended to acquire the paperwork for the workers and did not have the ability to do so.

H-2B visas let employers hire foreign workers for temporary non-agricultural work. The government limits the number of visas issued each fiscal year to 66,000, which are divided into halves for the first and second part of the fiscal year. International recruited the plaintiffs for work starting Oct. 1, 2008, but by that date - the first half of fiscal year 2009 - the cap for H-2B visas had been reached, according to the complaint.

The defendants concealed that they could not get the documents on their own but paid a third party for them, then falsely said that they paid (nonparty) Exchanges USA for the paperwork, the class claims. When the defendants failed to deliver the paperwork, they claimed Exchanges had sold the workers' certifications to a fourth party, according to the complaint.

Plaintiff Ramhari Subedi said the defendants persuaded him to recruit more than 100 Nepalese workers at $300 each to and wire International tens of thousands of dollars. Subedi says International did not give him the I-797 certifications by its deadline, said it would get them from another company, claimed Exchanges had sold them and refused to refund his money.

Subedi says he contacted Exchanges, which told him that International had never paid it to process or acquire the documents.

Plaintiff Anirudra Gaire says International failed to get him an I-797 certification or H-2B visa despite his payment, and conned $15,000 from plaintiff Lot de Leon's recruitment company, Access International Manpower & Communications, under the guise of providing the documents to clients in the Philippines.

The class seeks damages for breach of contract, breach of fiduciary duty, fraud and racketeering. They are represented by Paul Markoff.

Follow @@MatthewCRenda

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.

Email *

Submit