Every year, hundreds of thousands of people, all dreaming of a better life in America, apply for the H-1B visa. This visa allows them to work in the United States. However, only 85,000 of these visas are granted each year, making the competition fierce.
If you’re one of those hoping to secure an H-1B visa, imagine finding out that the system might be rigged. New data obtained by Bloomberg suggests just that. According to the US news agency, some companies have been manipulating the lottery system to gain an edge over others who follow the rules.
The data that Bloomberg recovered covers lotteries conducted from 2020 through 2023 and it reveals a form of cheating that has become widespread in recent years. The tactic, known as “multiple registration,” involves submitting more than one lottery entry for the same person to increase their chances of winning. Federal officials describe this practice as “fraud.” Bloomberg estimates that about 15,500 visas — roughly one out of every six awarded last year — were obtained by gaming the lottery in this way.
What is multiple registration?
“In one case allegedly involving India’s Kandi Srinivasa Reddy, he set up 13 related companies and submitted over 3,000 registrations for around 288 employees. This meant there were more than 10 registrations per applicant, giving them a significant advantage over someone who submitted just one registration. The selected candidates were then rented out to tech companies in the US, with a percentage of the worker’s pay collected as commission,” Vivek Tandon, Founder and CEO of EB5 BRICS told Business Standard.
“These scams create a vicious cycle where getting selected in the lottery becomes tougher and this, in turn, makes such illegal options more attractive for tech workers in the US,” he explained.
H-1B visa lottery system and its loopholes
In the mid-2000s, the demand for tech workers in the US surged, causing all available H-1B visas to be taken within a day or two. To manage this, the US Citizenship and Immigration Services (USCIS) created a yearly lottery to decide which applications would be considered. Over time, the odds of winning this lottery decreased.
“The lottery system made it hard for companies wanting to hire specific people with specialised skills. These companies often lost their desired candidates to chance. Even if they won, they might have to wait over a year before the worker could start.
“Outsourcing companies allegedly benefited the most from this lottery. These companies, based mainly in India, provide US corporations with IT workers to save money on tasks. They need some employees to work in the US, so they enter many names into the lottery to increase their chances of winning,” according to Bloomberg.
Concerns about outsourcing companies
Policymakers have long been worried about the influence of outsourcing companies in the visa system. These companies often shift US jobs to India and prefer visa workers who accept lower wages and are more willing to relocate. Despite attempts to limit their access to H-1B visas, they remain the biggest users of the programme.
For instance, Cognizant, an outsourcing company with most of its workforce in India, significantly increased the number of H-1B visas it sought as lottery entries surged. This allowed it to maintain a steady number of visas despite a decrease in overall US employment. Cognizant’s strategy was to request far more visas than needed to ensure they received a sufficient number.
Role of Reddy
According to the report, Reddy’s companies allegedly collaborated to manipulate the H-1B lottery, securing over 300 visas since 2020. While companies playing by the rules received less than half the visas they requested, Reddy’s candidates were almost guaranteed to win. Most didn’t even complete the visa application process, yet his companies still got 54 visas, more than in any previous year.
Reddy claimed to be just a registered agent with minimal involvement, but evidence showed otherwise. He identified himself as the CEO and founder of multiple staffing companies, both in social media and official documents. Despite facing challenges from the USCIS for abusing the lottery, Reddy’s companies continued to operate and receive H-1Bs.
As his H-1B business grew, Reddy thrived. He established a foundation to aid farmers in his Indian hometown, launched a news operation, and entered local politics. Despite losing an election, he portrayed himself as a successful entrepreneur with humble beginnings.
How did other staffing firms catch on?
By last year, many staffing firms had adopted similar tactics, flooding the system with multiple entries for the same workers. This led to companies using these strategies to secure around 40,000 H-1Bs over four years. The median salary for staffing firm workers was lower than that for employees of regular companies, pointing at the difference in the kind of workers being admitted.
Were the lottery rules clear?
Jonathan Wasden from the ITServe Alliance argued that the lottery rules were vague, allowing companies to exploit loopholes without technically breaking rules. However, the USCIS disagreed, revoking visas obtained through multiple registrations and referring cases for criminal investigation.
In February, the USCIS changed the regulations to prevent multiple registrations, now selecting from unique individuals to ensure fairness. This resulted in fewer duplicate applications, but staffing firms still found ways to game the system.
What’s happening now?
“Staffing firms often don’t complete the visa application after winning the lottery, suggesting they don’t have actual jobs lined up” reports Bloomberg. They typically find work for selected candidates or drop the application if they can’t, unlike other companies that follow through with their applications.
Advertisements from Cloud Big Data recruiters reappeared, boasting about their success in obtaining H-1Bs and offering to help enter workers’ names multiple times in the lottery. This shows that despite changes, some firms continue to exploit the system.
Action taken by the US Government
The US government in recent months has taken measures to tighten the work visa regime. The USCIS earlier this year increased the H-1B registration fee to $215 from $10 and the application fee to $780 from $460. It also added a $600 ‘asylum fee’ while filing H-1B and other petitions, making the process costlier.
The USCIS said in April that the number of eligible registrations had declined by nearly 40% from 758,994 for FY 2024 to 470,342 for FY 2025. It attributed the drop in numbers to its new ‘beneficiary-centric’ approach that it said was meant to reduce fraud. The total number of registrations also dropped from 780,884 for FY24 to 479,953 for FY25.
How the H-1B Lottery System works
Originally designed to allocate H-1B visas on a first-come, first-served basis, the USCIS switched to a lottery system due to overwhelming demand with a cap of 85,000. Each year, the lottery draws names randomly from the pool of applicants, which has nearly doubled in recent years, making the chances of securing a visa increasingly slim.
