H-1B Visa Fraud Crackdown Act Proposes $250,000 Employer Penalties and 10-Year Sponsorship Bans

by Niloofar Rahimi Zadeh updated on Oct 9, 2026 05:59:32 PM

A new House bill would sharply increase penalties for employers that commit serious H-1B violations, including raising the maximum statutory fine for willful violations involving the displacement of U.S. workers from $35,000 to $250,000.

The H-1B Visa Fraud Crackdown Act, introduced as H.R. 10643 by Representative Beth Van Duyne of Texas on October 1, 2026, would also extend certain employer sponsorship bans and increase penalties for immigration document fraud. (vanduyne.house.gov)

However, the proposal is not currently law. It has only been introduced in the House and referred to the House Judiciary Committee.

What the H-1B Visa Fraud Crackdown Act Would Change

H.R. 10643 targets employers found responsible for willful or serious violations. It does not impose new fines on H-1B employees.

Violation category	Current amount or period stated in the law	Proposed change
Covered willful H-1B violations	Maximum $5,000 penalty	Maximum $100,000 penalty
Sponsorship ban for those violations	At least 2 years	At least 5 years
Willful violations involving U.S. worker displacement	Maximum $35,000 penalty	Maximum $250,000 penalty
Sponsorship ban when displacement is involved	At least 3 years	At least 10 years
Initial covered document-fraud violation	$250–$2,000 per document	$1,000–$10,000 per document
Document fraud after a prior order	$2,000–$5,000 per document	$20,000–$50,000 per document

Examples of covered employer misconduct may include willfully misrepresenting material information, underpaying workers, or violating H-1B labor protections. The highest proposed penalties would apply when a willful violation is connected to the displacement of a U.S. worker. (vanduyne.house.gov)

The document-fraud provisions amend a broader section of immigration law and are not limited exclusively to H-1B cases.

The Proposal Does Not Change H-1B Rules Yet

As of October 10, 2026, the bill’s latest official action remains its October 1 referral to the House Judiciary Committee. It has not passed the House or Senate and has not been signed by the president. (govinfo.gov)

For the proposal to become law, it would generally need to:

Advance through committee;
Pass the House;
Pass the Senate in an identical form; and
Receive the president’s signature or otherwise become law through the constitutional process.

Until that happens, H.R. 10643 does not alter existing penalties or sponsorship restrictions.

The bill also does not change:

The annual H-1B cap or registration process;
Specialty-occupation eligibility;
H-1B portability rules;
OPT or STEM OPT requirements;
CPT or Day 1 CPT regulations; or
The qualifications required for an H-1B petition.

What the Bill Could Mean for H-1B Workers

The immediate effect is limited because the bill is still pending. If enacted, its main impact would fall on employers rather than visa holders.

An employer that is debarred cannot sponsor covered immigration petitions during the debarment period. Department of Labor guidance states that debarment does not, by itself, invalidate existing H-1B visas. However, the sanctioned employer may be unable to file extensions or employment-based green card petitions during the ban. (webapps.dol.gov)

That distinction matters for workers. An H-1B employee whose employer becomes subject to enforcement may need to assess whether another employer can file a qualifying petition before future status or employment-authorized-stay deadlines arise.

F-1 students moving from OPT or STEM OPT to H-1B should also carefully evaluate prospective sponsors. Warning signs can include an employer asking the worker to pay prohibited petition costs, promising a job that does not match the petition, failing to pay the required wage, or placing an employee in unpaid “bench” status because work is unavailable.

H-1B workers are generally entitled to the higher of the actual or prevailing wage and must be paid for certain employer-caused nonproductive time. Employers are also prohibited from retaliating against workers who report suspected H-1B violations or cooperate with an investigation. (dol.gov)

What to Watch Next

The key question is whether the House Judiciary Committee takes further action on H.R. 10643. Committee hearings, amendments or a markup would indicate that the proposal is advancing.

For now, employers and workers should treat the $100,000 and $250,000 figures as proposed penalties—not current law. H-1B employees concerned about unpaid wages, prohibited fees, inaccurate job information or retaliation can review Department of Labor resources and the process for submitting an H-1B complaint.

Sources:

Topics: H1B Status

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