Fraud Summary: Lima

UNCLAS LIMA 000480 SIPDIS DEPT FOR CA/FPP Posts for Fraud Prevention Managers E.O. 12958: N/A TAGS: KFRD CVIS CPAS CMGT ASEC PE Ref: 08 State 74840 SUBJECT: Fraud Summary: Lima ¶1. (U) Post is submitting its semi-annual fraud summary for September 2008 - February 2009. Responses are keyed to paragraph markers in reftel. Post continues to submit septel spot reports on specific cases of interest. ITEM A: COUNTRY CONDITIONS -------------- ¶2. (U) Peru's economy is faring far better in the financial crisis than most countries in the region. Although the growth rate was previously soaring at nearly 9 percent, its revised forecast for 2009 still remains positive at 5 percent, according to Peru's Central Bank's January 2009 "Inflation Report". Lima's NIV refusal rate is also lower. The period of December 1, 2008 to February 28, 2009 showed a 32 percent refusal rate, compared with 43 percent for the same period in the previous year. ¶3. (U) Peru is a high fraud post. False documents are easily available, as are genuine documents containing false information. Document vendors work in plain sight, and have approached Embassy officers on their way to work, mistaking them for potential clients. Vendors and "visa fixers" coach applicants on potential questions, and the "correct" answers to provide. They provide false addresses in more upscale neighborhoods and even loan out clothes for the interview. FPU and RSO are working to curb their activities. Post has seen vendor rings not only for tourist NIVs, but for nearly every work-authorization visa category. See NIV fraud below, under the false H2B petition. ¶4. (U) Peruvian National Police anti-fraud units work closely with the Embassy on investigations of human trafficking and visa forgery rings. ITEM B: NIV FRAUD -------------- ¶5. (U) Fraud is widespread in all categories of NIVs. B1/B2 applicants frequently obtain and submit fraudulent supporting documents to demonstrate their ties to Peru. Back-dated immigration entry stamps are a continuing problem, and applicants that DHS turns around at the border frequently admit to paying Peru's immigration officials approximately 100-500 USD for them. In cases where an applicant presents confirmed false documents that are material to the case, Post works with the local police, who often detain the applicant with the goal of identifying and ultimately prosecuting the vendor. Post also works with the police to follow up on investigations of possible document vendors. �A; H2A Sheepherders ¶6. (U) Approximately 90 percent of U.S. sheepherding jobs are filled by Peruvian nationals on H2A visas. Past fraud trends have included: fraudulent petitions; genuine petitions sold to malafide applicants who were never hired for the job; and admissions by applicants that they paid fees of up to 5000 USD to visa fixers. Post has taken significant measures to reduce fraud surrounding the petitions. Petitions that do not have the applicant's name already listed on it are referred to FPU, which then contacts the petitioning agency or the ranch itself to verify the applicants. All petitions must appear in PIMS before visa issuance. ¶7. (U) In the meantime, a longstanding problem remains in the spotlight: H2A extortion and trafficking, perpetrated by fellow villagers or sheepherders already in the U.S. It is common for a sheepherder to recommend a brother-in-law or cousin to their employer, and then exact a fee - often one month's salary - for the "favor." ¶8. (U) More egregious examples exist. In January 2009, a ranch informed Post that one of their sheepherders was unable to return to Indiana. A visa fixer had taken possession of his visa-ed passport and demanded 2000 USD in exchange for returning it. FPU spoke to the applicant, and learned that he had obtained his first H2A position in 2004 by paying 4000 USD to this visa fixer. The applicant stated that he believed this was a standard process. Due to his lack of access to information and low level of education, FPU was inclined to believe him. He also stated that this visa fixer's family was powerful in his mountain village, and that he feared involving the police. FPU revoked the visa that had been issued and reissued a second visa once the applicant obtained a new passport. (Post is working with the Public Affairs Section to educate the Peruvian public, specifically in isolated sheepherding areas, about extortion in H2 visa petitions; see "Areas of Particular Concern"). I Visas ¶9. (U) Journalist visas have historically been a fraud-ridden category. Despite our SOP that all I applicants be vetted with Embassy's Public Affairs office through FPU, fraud continues. No government office or association exists in Peru to issue journalist credentials, and the College of Journalism refuses to issue credentials to "non-professional" journalists. The difficulty is that "professional journalists," i.e. those educated as such, account for only 20 percent of the journalists working in Peru.) The following examples illustrate some of the recent I visa fraud encountered. ¶10. (U) In November 2008, the director of a press agency applied to renew his I visa, and to accompany two assistants applying for first time I visas. On his prior trip, two different assistants accompanied him. The interviewing officer inquired as to the whereabouts of the first two assistants. She stated that he "appeared nervous" and that he "was sweating during the interview with short answers to questions." She referred the cases to FPU for the standard confirmation, but also requested an extra step - a verification that his prior assistants had returned to Peru. They had not. The case was referred to the police. ¶11. (U) The second case regards a media company owned by five brothers, well known in Northern Peru. Two of the owners applied for a revalidation of their I visas, and also applied with an assistant. FPU noted that the owners had already traveled with a number of assistants, and ran an ADIS check on the travel history of everyone associated with the company. Surprisingly, the assistants had all traveled well, but two of the five owners had significant stays in the U.S. One was admitted for one month but stayed nearly two years, while the other stayed for more than five years. Although he was admitted for duration of status, he claimed on his visa application that it was a 13 day stay. H2B: Fake Petition ¶12. (U) In January 2009, Post interviewed an applicant for an H2B position as a horse groomer. The application was sent to FPU for a standard H2 employment verification. When the investigator called the employer, she stated that she had never offered a job to the applicant. In addition, she stated that she no longer works with the law firm listed on the petition. When contacted, the law firm stated that they had never filed for a petition on behalf of this applicant, and pointed out several errors on the petition. Finally, DHS reported that there was no record of the petition receipt number. FPU alerted the Assistant Regional Security Investigator (A/RSO-I) who stands ready to interview him, but the applicant has failed to show to any follow-up appointments. J1 Work and Travel: Fake Transcripts ¶13. (U) The 2008 J1 Summer Work and Travel (SWT) season began mid September and continued through December. During that time, Post processed close to 10,000 SWT visas. A primary concern during J season is the frequency of false transcripts. Post routinely requests these transcripts so that we can ensure that the students are duly enrolled. Previous validation studies have also confirmed that students with above-passing grades are much more likely to make timely returns at the end of their program. Post's J1 officer and FPU familiarize line officers with transcripts from the most frequently-seen universities, and when officers suspect a false transcript (often only detectable with eye loops),Post calls the university's registrar. A surprising number of the students presenting false transcripts were registered as full-time students, and their actual grades were not poor. Line officers agreed that if these students had presented their true transcripts, they may have found them to be serious students with strong ties to their university programs. However, these students were motivated to inflate their grades due to rumors circulating about what the minimum requirements were. Because of this, post does not plan to routinely request transcripts in the coming SWT season. ¶14. (U) It is important to note that, despite the number of fake transcripts presented, validation studies of Lima's J1 visas continue to show an extremely high return rate of those whose applications are approved. ITEM C: IV FRAUD -------------- ¶15. (U) Immigrant visa fraud is common in both family- and employment-based IV categories. Mala fide applicants often use fraudulent birth and marriage certificates to support their cases. 16.(U) Marriage fraud in Lima is the most common type of IV fraud and ranges from individual American citizens being duped by fiances with no desire to marry to well thought-out scams by Lawful Permanent Residents (LPRs) and Amcits trying to help family or friends get to the United States. Fraud indicators include applicants who meet through coincidence online or over the phone when a friend or a family member introduces them and petitioners who travel to Peru just once in order to get married (and pose for pictures of the couple to be submitted to the IV unit) and then never return. Post tries to combat this type of fraud by requesting interviews with both the petitioner and beneficiary when the applicant cannot provide sufficient proof of relationship. This occurred in approximately 4 percent of our marriage based cases for this reporting period. Fraud relating to derivatives and other petitionable relationships is common as well. ¶17. (U) While not as rampant as relationship fraud, employment-based IV fraud is found in the E3 and EW categories. Usually the fraud occurs in the form of fraudulent employment experience or education letters. ITEM D: DV FRAUD -------------- ¶18. (U) Peru graduated from the DV lottery on Sept. 30, 2007. ITEM E: ACS/PASSPORT FRAUD -------------- ¶19. (U) ACS caught two cases of photo-substituted passports, during their applications for renewals. In both cases, the passports (issued in 1999 and 2006) had the laminate edge by the photo completely lifted. In one case, the American citizen's original photo (confirmed in PIERS) was in the passport, but it had clearly been cut for removal and came out of the passport easily. The signature on the passport also looked different from the signature on the application or in PIERS. The FPM and the A/RSO-I interviewed the applicant, and then the A/RSO-I opened an investigation. The suspicion is that the American citizen pulled out his photo and kept it, giving his passport to someone else for travel, and then re-inserted his photo before coming to the Embassy. Since he could provide proof that he is who he says he is, a limited passport (as a replacement for a damaged passport) was issued. In the other case, the photo of the applicant appeared to be scanned onto the laminate, although the photo again matches PIERS, and no other identities come up through FR on Demand. The applicant also has a child support hit, which he was supposed to resolve when a previous one-entry passport was issued. We believe he simply departed the U.S. on his Peruvian passport without ever paying the child support that led to the HHS hit. Since the passport he presented was expired, the FPM canceled and kept it. He has not yet returned to the embassy, and the case is pending. ¶20. (U) Post recently encountered a Consular Report of Birth Abroad (CRBA) case involving in vitro fertilization where fraud was indicated. The couple had claimed that the wife had carried the child, when in reality a non-citizen third party had given birth. In the same week, another CRBA case that had been referred for DNA testing came back as not at match. Post subsequently re-instituted a former SOP to refer a CRBA application to FPU if: a) the child was born out of wedlock; b) citizenship is being transmitted through a father who does not live in Peru; or c) the CRBA is not being registered in a timely fashion. A specialized training is currently being prepared for ACS, with details to follow in the next Fraud Summary. ITEM F: ADOPTION FRAUD -------------- ¶21. (U) Adoptions in Peru are marked more by applicants potentially not qualifying under U.S. immigration law as orphans rather than more direct fraud through documents or false relationships. It is not unusual for Peruvian-Americans to adopt young relatives such as nephews and nieces, and while the adoption "by exception" is legal under Peruvian law, the adopted child may not be an orphan as defined in the FAM. The child often still lives with one or both biological parents, making the adoption a matter of convenience or opportunity. IV and FPU work closely to ensure the integrity of adoption-related IVs in Lima. USE OF DNA TESTING -------------- ¶22. (U) Most DNA requests originate from the IV section, with a few requested in ACS. A red flag indicator is a late-registered birth certificate, as most birth certificates should be registered within 1-3 months of a child's birth. If a birth certificate is registered late, applicants are given the opportunity to prove their relationship through other means. If the officer is not convinced, a DNA test is requested. The IV chief must approve all requests for DNA testing. ¶23. (U) For this reporting period, the IV Section requested DNA results for 18 cases. Of those, 13 showed a biological match, 1 returned as negative for a match, and 4 have not yet followed through. In ACS, 1 returned a negative result and 2 applications were withdrawn. There were 17 positive matches. ¶24. (U) Post does not have any operational concerns with DNA testing. It is considered a successful fraud deterrent, and at times critical to establishing relationships. The ACS unit and FPU coordinate unscheduled periodic visits to the two certified DNA laboratories to ensure proper procedures are being followed. ASYLUM AND OTHER DHS BENEFITS FRAUD -------------- ¶25. (U) DHS/CIS officer assigned to post handles these matters. FPU enjoys excellent cooperation with the local DHS office, as the two offices prioritize each others' requests for information. ALIEN SMUGGLING, TRAFFICKING, ORGANIZED CRIME, TERRORIST TRAVEL -------------- Lima as transit point for PRC smuggling ¶26. (U) Lima is a transit point for illicit travel, and became even more attractive as such when neighboring Ecuador instituted its recent visa-free immigration policy. In Septel STATE 000123, Post reported that a ring had been busted for smuggling Chinese asylum-seekers to the U.S. with phony home-made Japanese passports. A search of the ring's "labs" suggested they were also targeting Korea's recent accession to the Visa Waiver Travel program, as the search turned up Korean passports and Korean immigration stamps. ¶27. (U) The route for the smuggled PRC nationals would begin with a flight from China to Ecuador, and then an overland journey from Ecuador to Peru. They picked up the phony passports in Peru, and then purchased tickets to fly "home" to Japan via a U.S. Port of Entry. (Once Peruvian Immigration began presenting obstacles for them, they would travel overland again to leave from Bolivia, Brazil, and sometimes Argentina.) During the flight to the U.S. they would destroy the phony passports, and present their PRC passports at the POE. Post responded to this discovery by alerting DHS and other law enforcement agencies at post, as well as through the reporting cable. Peruvian robbers doing "business" in Cairo? ¶28. (U) A curious connection has emerged between Peru and Egypt: seven Peruvians have been arrested in Cairo during this reporting period. The first three were arrested for a bank heist of one million USD. The next four were arrested for attempting to rob a money exchange office. Two more malafide travelers, one Peruvian and one traveling on a fake Peruvian passport, were detected en route to Cairo. The traveler with the fake Peruvian passport was spotted in Bangkok, with the following travel plans: Phnom Penh-Bangkok-Cairo-Bangkok-Kuala Lumpur-Amsterdam-Lima. The second traveler was arrested in Rio de Janeiro, ostensibly on his way to Cairo, but with a false Mexican passport hidden in the sole of his flip-flop shoe. His true destination was apparently Mexico, and he presumably purchased the ticket to Cairo as a cover. Post is working with RSO, the Peruvian National Police, Interpol, and U.S. Embassy Cairo to determine if this is part of a larger ring, and who might be funding these trips. Sri Lankans: destination Lima ¶29. (U) The Peruvian police have reported three waves of Sri Lankan males arriving in Lima within weeks of each other, with Peruvian visas issued in India. The most recent wave arrived from Brazil in January. The police stated that a Sri Lankan who had arrived in the previous weeks met them at the airport. They appeared not to know each other well, and took a taxi to an unknown destination. The onward destination in these cases seems to be Canada. FPU has alerted colleagues at the Canadian Embassy. Washed Visas ¶30. (U) DHS's office of Customs and Border Protection (CBP) stays in close contact with Post regarding cases of malafide travelers, usually traveling from Peru to a U.S. Port of Entry. It is not uncommon for travelers to use real passports with altered U.S. visas, either traveling under their real name or a completely false one. Airlines are very helpful partners in identifying a false visa. For example, in December 2008 COPA airlines contacted CBP about a traveler who fled the Lima airport when authorities noticed her false visa in a passport issued in a different name. She had fled the airport when detected, and local authorities could not determine her true identity. CBP scanned a copy of the visa and emailed it to Post. When her picture was run through Facial Recognition, the CCD matched her photo with her three recent visa refusals. Post's access to the Peruvian national registry database (RENIEC) allowed FPU to verify her true identity. We shared her true identity with local authorities so she could be prosecuted for passport fraud. Drug Cartel ¶31. (U) At the request of Department of Treasury officials, FPU investigated partners of the incarcerated Peruvian drug lord Fernando Zevallos Gonzales, whose family has been named under the Kingpin Act. Post identified 14 key associates and 23 Peruvian-registered businesses related to his drug-running scheme and immediately revoked the visas of those listed as key business contacts. In addition, FPU used the Peruvian business database, SUNAT, to identify the legal representatives and managers of the 23 companies, sharing the data with Treasury. Post found four more visa holders this way, and prudentially revoked their visas as well. DS CRIMINAL FRAUD INVESTIGATIONS -------------- ¶32. (U) FPU refers cases that appear to involve organized fraud to the A/RSO-I, who determines if and where a criminal element is present and follows up on the investigation. There is significant information-sharing and discussion between the Consul General, the FPM and the A/RSO-I regarding ongoing cases. HOST COUNTRY PASSPORT, IDENTITY DOCUMENTS, AND CIVIL REGISTRY -------------- ¶33. (U) Peru issues the Andean Community passport, which is ICAO compliant. The passport has a laminated bio-data page and a digitized photo. The photo and signature of the holder are incorporated into the basic material of the data page. A Peruvian citizen can easily obtain and use a new or second passport in a true or false identity to conceal illegal stays in the United States or for other illicit purposes. ¶34. (U) Peruvian civil documents vary between each municipality and are relatively easy to falsify and obtain. Corrupt notaries and municipal officials have been known to accept payment to issue authentic civil documents using false personal data. Peruvian law allows late registrations of birth based on minimal evidence - a sworn statement of a witness many years after the fact is acceptable. With birth certificate in hand, a legitimate passport in a false identity can be easily obtained. A birth certificate issued within the last three months is required to renew or obtain a first-time passport. Post has access to the Peruvian National Identity database, a web-based application that provides access to the information submitted to obtain the Peruvian National Identity card. However, as with passports, Post often encounters genuine registrations in this system based on false bio-data. COOPERATION WITH HOST GOVERNMENT AUTHORITIES -------------- ¶35. (U) Peruvian statutes include laws against visa fraud, alien smuggling and trafficking in persons. Although Post works closely with the Peruvian National Police's anti-fraud division on many investigations, outside of this unit, results in case follow up and application of existing laws vary widely. FPU enjoys good relations with Peruvian immigration authorities (DIGEMIN) who host FPU training teams in various parts of the country. Airline representatives consistently indicate unwillingness to provide information on malafide passengers to the local police due to their stated concerns that the police may be corrupt. AREAS OF PARTICULAR CONCERN -------------- ¶36. (U) H2 visas remain a heightened area of concern for Post. FPU is working on a joint initiative with the Public Affairs Section to air public announcements in sheepherding communities in order to educate potential applicants on what is and is not allowed in the visa application process. ¶37. (U) Cooperation with other posts is frequent and very useful. Recent exchanges with Bogota, Quito, Cairo, and Rio de Janeiro have covered issues ranging from validating a birth certificate to sharing information about a Peruvian traveling through South America with a false U.S. passport. ¶38. (U) In addition, the information exchanged between FPU and Post's local DHS office is vital, and covers a wide range of issues. Consular officers often have questions about incomplete information entered into the CCD, which can only be resolved by contacting DHS. Lima's FPU recognizes that its workload and operations are helped greatly by the quick responses from the local DHS office. ¶39. (U) As will be further reported septel, Post's Consular Section and DHS/CIS Laguna Nigel Service Center held a joint Digital Video Conference on March 25, 2009, to "meet" one another and answer questions about Petition processing. STAFFING/TRAINING -------------- ¶40. (U) Post's FPU consists of one Fraud Prevention Manager, an entry-level officer position which rotates through the Unit every three months, three full time LES investigators, a part-time rotational LES administrative position and the A/RSO-I. Two of Post's fraud investigators have traveled to Washington for training. Post's FPM took Fraud Prevention for Consular Managers at FSI in February 2009. The senior LES investigator/supervisor and the LES clerk took the FSN Fraud Prevention workshop at FSI in 2002 and 2007 respectively. MCKINLEY