(UNITED STATES) – The Trump administration launched its first major fraud investigation into the H-1B and PERM visa programs on July 8, 2026, opening a multi-agency crackdown led by the Department of Labor with the Department of Homeland Security and the Department of Justice.

Labor Department Inspector General Anthony D’Esposito said investigators had already begun issuing dozens of subpoenas to companies and labor brokers suspected of manipulating the visa system. The inquiry places employment-based immigration enforcement near the center of the administration’s anti-fraud agenda.

Without a doubt, we are going to take what we believe is probably the most aggressive action against foreign labor fraud by an Inspector General in this administration. We’ve already started to issue dozens of subpoenas. We are going to make sure that we track down every lead.

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The probe targets two pillars of legal employment immigration. The H-1B visa covers specialty occupations, while PERM certification is the labor certification process required for employment-based green cards.

D’Esposito said the case had implications far beyond paperwork violations. “This is another example where fraud is fueling violent crime. Much of the visa and the human trafficking that we see when it comes to this foreign labor is tied to cartels, is tied to transnational gangs. This is not just people working in factories; these are people working in medical facilities and doctors’ offices that are actually putting people in harm’s way.”

An official message posted by @DOLOIG on July 8, 2026 cast the investigation in similarly forceful terms: “NEW INVESTIGATION: @USLaborIG is cracking down on H-1B and PERM visa fraud. Fraudsters gaming the system—beware. We’re issuing subpoenas, tracking every lead, and putting criminals in cuffs. Teaming up with @POTUS & @VP’s @WHFraudTF to put American workers first.”

Project Firewall and Broader Enforcement

The inquiry forms part of Project Firewall, a multi-agency initiative launched in September 2025 to increase H-1B oversight. Since then, the Labor Department has opened more than 175 investigations into abuses in visa programs.

Vice President JD Vance’s White House task force to eliminate fraud is coordinating closely with the effort. Vance outlined the administration’s broader anti-fraud strategy during an event in Milwaukee on the same day the investigation became public.

D’Esposito also said whistleblowers had raised concerns involving large technology firms. He named Cognizant as part of the investigation’s current “chatter,” though no formal charges have been filed.

Shift to Proactive Audits

The shift marks a change in how the government approaches oversight of employment-based visas. Instead of relying mainly on complaint-driven reviews, the administration has moved toward a proactive “Secretary-certified” audit model.

Under that approach, the Secretary of Labor can personally initiate audits based on “reasonable cause” alone. That lowers the threshold for federal scrutiny and gives investigators room to act before a formal complaint drives an inquiry.

Employers now face a more intrusive compliance environment. Companies can draw unannounced site visits and online presence reviews, and firms found out of compliance risk removal from the H-1B program, civil penalties, and criminal charges.

New Wage-Based Selection System

That pressure comes as the administration reshapes how H-1B cases enter the system. A wage- and skill-based selection system took effect on Feb. 27, 2026, replacing the random lottery and favoring the highest-paid applicants.

The change has altered the math for employers and workers alike. Lower-paid and entry-level professionals now face steeper odds, while companies must defend not only the legitimacy of a job offer but also the wage level attached to it.

Signature Requirements and Financial Barriers

Another rule change arrives this week. Starting July 10, 2026, USCIS will reject any application filed with auto-generated or copy-pasted signatures under new signature requirements.

That rule reaches beyond fraud rhetoric and into filing practice. Employers, lawyers, and foreign workers now have to treat signatures as a strict compliance point, because a defective signature can stop a filing at intake.

The administration has also tested more aggressive financial barriers. A federal court struck down a $100,000 H-1B entry fee in June 2026, but the administration has said it will appeal and seek to restore it.

Broader Enforcement Themes

Together, those moves show how the Trump administration has tied legal labor migration to broader enforcement themes. Officials are presenting foreign labor fraud as an immigration issue, a workplace issue, and a criminal case file that can extend to human trafficking and gang activity.

The framing matters inside federal agencies because it changes who leads and who participates. Labor investigators, homeland security officials, and federal prosecutors now sit on the same track when they examine visa filings, broker relationships, and employer conduct.

D’Esposito’s office has made clear that the inquiry will not stop with a single company or a narrow document review. The inspector general said investigators would follow “every lead,” language that signals an expanding review across employers, intermediaries, and recruiting pipelines.

Impact on Businesses and Workers

Businesses that depend on high-skilled foreign labor now face scrutiny on two fronts at once. They must adapt to a selection system that favors higher wages, while preparing for audits and subpoenas that can test whether the filing itself withstands a criminal or civil examination.

Foreign workers face a different risk. Even without any allegation against them personally, they can be caught in delayed filings, rejected applications, or employer investigations that affect job offers, work authorization, and green card timelines.

The government’s use of subpoenas in the opening phase also suggests a broad evidence sweep rather than a narrow paperwork check. Investigators can seek records from companies and labor brokers as they piece together how jobs were advertised, how wages were set, and whether recruitment practices matched immigration filings.

Project Firewall gives that effort an existing structure. With more than 175 investigations opened since September 2025, the new H-1B and PERM inquiry starts inside an enforcement system that has already been running for months.

The administration has not announced charges in the new case, and the early emphasis remains on subpoenas, audits, and interagency coordination. Still, the language from D’Esposito and the @DOLOIG post leaves little doubt about the direction of travel: “We’re issuing subpoenas, tracking every lead, and putting criminals in cuffs.”