17 April 2012

Infosys in trouble over US visa allegations

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Indian technology giant Infosys faces an investigation from US immigration officials regarding its use of US visa to bring certain employees into the company.

US visa

Infosys faces an investigation over its use of American visas for Indian employees.

The multinational corporation, whose speciality lies in outsourcing work to Indians, currently has 10% of its 150,000 strong workforce living in America on a US visa. However, the company is facing worrying times due to allegations it broke visa rules to get Indian employees into the country.

The investigation by the US Attorney's Office, confirmed by Infosys in a statement released on Friday, is regarding allegations that Infosys abused the B-1 visa rules in order to employ Indians within the US and the company could face extensive fines and penalties if it is found guilty of the allegations.

The company has remained defiant in the face of the economic crisis with shares falling only 8%, compared to competitor Reliance Industries slumping 26% in 2012 alone. However, following the news of the investigation combined with a predicted slow in profits, shares in Infosys fell a further 12%.

News of the investigation predict a worrying time for Infosys as well as India's burgeoning technology industry in general; tightening US immigration legislation will make it harder for companies to hire foreign born employees in the US. India's reliance on American business saw the country lodge a formal complaint with the World Trade Organisation last week.

Alongside complaints of unfair discrimination against Indian workers, immigration looks set to be a critical issue in the upcoming presidential election, after which firms could be made to consider American workers before looking abroad.

Commentators say Infosys will have to make extra effort to ensure all their bureaucratic measures are correct to avoid any further difficulties with American authorities, and this will incur further costs.

In the statement published to confirm the investigation, Infosys denied all allegations:

"Any allegation or assertion that there is or was a corporate policy of evading the law in conjunction with B-1 visa program is simply untrue."

The American Visa Bureau is an independent migration consultancy specialising in helping people from Visa Waiver Program (VWP) countries make their ESTA application.

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