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Perplexity ChatGPT Claude Gemini

"Handcuffs Await": US Labor Department Halts Cognizant and Cloudera's Green Card Filings Amid Fraud Probe

Perplexity ChatGPT Claude Gemini
"Handcuffs Await": US Labor Department Halts Cognizant and Cloudera's Green Card Filings Amid Fraud Probe

In a single evening of pointed social media posts, a federal watchdog delivered a blow to two major tech employers' ability to sponsor foreign workers for permanent residency. On September 8, 2026, the U.S. Department of Labor confirmed it had suspended Cognizant's Permanent Labor Certification (PERM) filings, with Inspector General Anthony D'Esposito following up almost immediately to announce that IT company Cloudera's PERM filings had been suspended as well.

Here, our EB-1A green card consultants have discussed in detail what this news exactly means for the green card aspirants within these two organizations and what could be the far-reaching consequences.

The announcement that broke the news

The suspension was not delivered through a formal press release, but through a blunt post on X from D'Esposito: "Threats to American workers will not be tolerated. Alongside @WHFraudTF, we are following facts, frauds and finances. Handcuffs await." Moments later, in a separate post, he added a second company to the list: "One more. @cloudera: PERM filings SUSPENDED."

D'Esposito framed the crackdown as a coordinated effort, writing in one post, "Fighting fraud is a TEAM SPORT," and referencing the involvement of the White House Fraud Task Force tagged in his posts as @WHFraudTF. His office did not disclose the specific allegations against either company, the number of applications affected, or how long the suspensions would remain in force.

Cognizant did not immediately respond to a request for comment, according to Business Standard's reporting on the suspension.

What PERM actually is, and why the freeze matters

The Permanent Labor Certification programme, commonly known as PERM, is a foundational step in the employment-based green card process. As Business Standard explained, "A permanent labor certification issued by the Department of Labor allows an employer to hire a foreign worker to work permanently in the US." Before a company can submit an immigration petition to U.S. Citizenship and Immigration Services, it must first obtain a certified labor certification application from the Labor Department's Employment and Training Administration. This is to demonstrate that no qualified U.S. workers are available for the role and that hiring a foreign worker won't adversely affect American wages or conditions.

Importantly, the suspension is narrowly scoped. As Business Standard reported, "the current suspension does not impact Cognizant's existing approvals or its H-1B visa programmes". In other words, workers already in the pipeline are not directly affected. What is frozen is the company's ability to file new PERM applications while the investigation continues.

The investigation behind the suspension

The move follows an investigation the Labor Department initiated after receiving whistleblower complaints alleging fraud connected to Cognizant's H-1B and PERM visa programmes. While the specific allegations remain undisclosed, the timing places the suspensions within a broader pattern of enforcement activity USCIS has been publicizing. In one such disclosure, USCIS's Vermont office described uncovering a troubling pattern at an unnamed "major IT consulting company": "USCIS in Vermont identified H-1B petitions from a major IT consulting company that classified skilled technology jobs at wage levels below what the positions' duties and requirements supported. This practice undercuts required wages and creates unfair competition for U.S. workers. We denied and revoked multiple petitions, protecting American workers and preserving the integrity of employment-based immigration programs."

Part of a bigger federal campaign: "Project Firewall"

The Cognizant and Cloudera suspensions do not exist in isolation: they are the latest visible output of a Labor Department enforcement campaign that has been building for nearly a year. On September 19, 2025, the department launched Project Firewall, described in its own announcement as an initiative to "safeguard the rights, wages, and job opportunities of highly skilled American workers" by ensuring "employers prioritize qualified Americans when hiring." Labor Secretary Lori Chavez-DeRemer framed the initiative's purpose bluntly: "By rooting out fraud and abuse, the Department of Labor and our federal partners will ensure that highly skilled jobs go to Americans first."

Under Project Firewall, the Wage and Hour Division prioritizes investigations where:

  • employers may be displacing U.S. workers,
  • failing to recruit them in good faith,
  • misrepresenting job duties, or
  • retaliating against employees who raise compliance concerns.

By early this year, Fox News reported the initiative had already opened more than 175 investigations into suspected H-1B violations, with Chavez-DeRemer stating the department was using "every resource currently at our disposal to put a stop to H-1B visa abuse." Hindustan Times, reporting on the Cognizant suspension specifically, noted the administration has made combating visa abuse a key policy priority through the initiative.

The bigger picture for Indian IT services firms

Business Standard characterized the Labor Department's move as demonstrating "the seriousness of the Trump administration in cracking down on allegations of misuse of these programmes by IT services companies". This is an important signal that PERM and H-1B compliance will likely face continued, high-visibility federal scrutiny. For companies in the sector, the episode is a reminder that PERM filings, once viewed as a routine administrative step, can now be suspended abruptly and publicly, based on allegations that may not be detailed until an investigation concludes.

At GCEB1, our EB-1A consultants are staying eagle-eyed to the minutest of changes in the US immigration landscape. Get in touch with us to get personalized guidance on the legal immigration pathways in the U.S. We wish you a safe and stress free immigration journey ahead.

Frequently asked questions

1. What exactly has the Labor Department suspended for Cognizant and Cloudera?

Their ability to file new Permanent Labor Certification (PERM) applications (the first formal step in sponsoring a foreign worker for an employment-based green card) has been suspended pending investigation.

2. Does this suspension affect Cognizant's current H-1B visa holders or existing PERM approvals?

No. According to reporting on the suspension, it does not impact Cognizant's existing approvals or its ongoing H-1B visa programmes; it applies specifically to new PERM filings.

3. Why was the investigation into Cognizant initiated?

The Labor Department began investigating following whistleblower complaints alleging fraud connected to the company's H-1B and PERM visa programmes.

4. What is PERM, and why is it significant for green card sponsorship?

PERM (Permanent Labor Certification) is a Labor Department certification employers must obtain before filing an immigration petition with USCIS for an employment-based green card, confirming no qualified U.S. workers are available and that hiring a foreign worker won't harm American workers' wages or conditions.

5. Has the Labor Department disclosed the specific fraud allegations against Cognizant or Cloudera?

No. The inspector general's announcement did not disclose the specific allegations, the number of applications affected, or how long the suspension will remain in effect.

6. Is this suspension connected to other recent USCIS enforcement actions?

It appears to coincide with a broader enforcement push; USCIS's Vermont office recently disclosed denying and revoking multiple H-1B petitions from an unnamed major IT consulting company for allegedly classifying jobs at wage levels below what the roles actually required.

7. Has Cognizant's use of H-1B visas been declining?

Yes. Labor Department data shows Cognizant's Labor Condition Application filings dropped from 10,189 in 2018 to 3,436 in 2025, reflecting a broader industry shift away from heavy H-1B reliance.

8. What government body is coordinating this fraud investigation?

The Labor Department's Office of Inspector General, working alongside the White House Fraud Task Force (referenced as @WHFraudTF), according to Inspector General Anthony D'Esposito's public statements.

9. What should other IT services and consulting companies take away from this action?

The suspensions signal heightened, high-visibility federal scrutiny of PERM and H-1B compliance, suggesting companies with large India-linked workforces should expect continued enforcement attention and should ensure their wage classifications and labor certification filings are fully compliant.

10. What is "Project Firewall," and how does it relate to this suspension?

Project Firewall is a Labor Department H-1B enforcement initiative launched in September 2025 to combat visa program abuse; it had already opened more than 175 investigations by early 2026, and the Cognizant and Cloudera PERM suspensions are widely seen as part of this broader enforcement campaign.

Sources & further readings

 

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