FRAUD SUMMARY - ST. PETERSBURG

UNCLAS SECTION 01 OF 03 ST PETERSBURG 000043

SIPDIS

DEPT FOR CA/FPP; CA/VO/KCC; RSO

E.O. 12958: N/A
TAGS: KFRD CVIS CPAS CMGT ASEC RS
SUBJECT: FRAUD SUMMARY - ST. PETERSBURG

REF: 08 State 102952


A. Country Conditions: Economic growth in St. Petersburg has
slowed markedly over the past year, with St. Petersburg's 2008
GDP at roughly RUR 1.1 trillion (USD 32 billion). The average
salary for St. Petersburg's 4.5 million is still about double
the nationwide average of about $5000 a year. Salaries
nevertheless lag behind those in Moscow, and have fallen by
about 5% since summer 2008 in the local currency, and by over a
third in dollars with the substantial ruble devaluation.
Economic indices -- including income, cost of living, and
jobless rates -- vary from region to region in Northwest Russia,
though members of ethnic minorities in particular tend to be
underemployed while the elderly are most vulnerable to broad
inflationary pressures. As evidenced from this and previous
reports, fraud is encountered at a medium frequency in St.
Petersburg.


B. NIV FRAUD: The worldwide economic crisis and ruble
devaluation have not spared Northwest Russia, and though the
majority of the NIV applicant pool remains a good bet, post
expects an increase in the number of mala fide applicants
seeking admission to and employment in the US. Even among
otherwise legitimate vacation travelers, many Russians still
consider it necessary to bolster their NIV applications with
fabricated documents, trumped-up employment letters, and
inflated salary claims. In addition, post has encountered an
increasing number of petition-based applications for work at
non-existent companies in the U.S.

B1/B2

Post encountered several applicants who provided fake job
letters and employment information in order to improve their
chances of qualifying for an NIV. Phone numbers listed for
their place of employment often turn out to belong to friends'
private apartments or are completely fictitious. Such
applicants cannot tell us the names or numbers of employees at
their company. Applicants also go to the trouble of falsifying
their Russian labor books to make their current and past
employment look more official. One particularly unprepared
applicant listed his employer's number as his own cell phone
number, and though he claimed to work for an advertising agency,
he listed the website of a home-appliance company on his
home-made letterhead. Another, who claimed to work for an auto
dealership in Murmansk, eventually revealed that his shop no
longer had any business, but he wanted to leave for a long
vacation in the U.S. anyway, leaving behind a six-month old
child and his wife.

C1/D

While the majority of Post's C1/D applicants are legitimate
crewmembers of the large number of ships sailing from the port
of St. Petersburg, we do occasionally come across attempts at
fraud.

One applicant, after receiving a C1/D on the strength of her
employment letter with Disney Cruise Lines, entered the U.S. in
April 2008 but failed to join her cruise ship, opting instead to
stay with her boyfriend in Florida, until she returned in
October 2008 for another C1/D to work for a different cruise
company. She was denied under Section 214(b).

Another crewmember abandoned his ship in the U.S. and was caught
and returned to Russia by DHS. Upon applying for a new C1/D
visa, he changed his last name and claimed he had never been to
the U.S. before. IAFIS checks revealed his true identity,
although he never admitted his fault in the interview, insisting
he is and always was his new identity. Subject was found
ineligible under 6C. This case raises particular concerns about
the veracity of Russian documents, particularly in the ease of
obtaining genuine documents from the proper legal authorities
with false biographic information.

F1

We continue to see cases of fake ESL packages prepared by local
visa facilitating agencies. One applicant who received an F1
for six weeks of ESL study at Temple University in 2007 ended up
staying until late 2008. When she appeared in early 2009 for
another F1, we launched an investigation, revealing that her
case was completely prepared by a local visa agency. The fixers
provided her with a fictitious husband and child, in an effort
to show strong ties to Russia to compel her timely return.
During her interview this year, she "forgot" she was "married,"
and she eventually confessed to paying money for the supporting

ST PETERSB 00000043 002 OF 003


materials, saying she had in fact studied at Temple only for one
of the 11 months she was in the U.S., and that she had actually
used her visa to reside with her LPR or Amcit boyfriend.

J1

A local agency coached another applicant prior to her interview
for a J1 visa (au pair). The applicant successfully made
arrangements with a family in the States and received J1. But
after she received the visa, the U.S. au pair agency contacted
post to inform us that they had canceled her SEVIS registration.
The applicant had told the agency that she missed the visa
interview and chose to withdraw from the program, although in
fact she had attended the interview and received a visa. Post
called the applicant back to cancel the visa, and she admitted
that her true intentions were to move to the States and live
with her sister's boyfriend. Post physically canceled her visa.


H/L fraud

The most disturbing trend Post has encountered is the growing
number of sham petition-based visa applications. We continue to
scrutinize these cases carefully, including renewals, since we
have uncovered cases that might not have been approved in the
past had we known all the pertinent facts. One example of such
is a third time, L-1 renewal case which raised eyebrows because
its claimed place of business and telephone number in the U.S.
matched those of the applicant's attorney. Further
investigation revealed that the company was not an operating
business and therefore did not qualify as an L1A petitioner,
resulting in a revocation request sent to DHS. While no
material false statements were located, information gathered
during his interview raised suspicions of money laundering, tax
fraud in Russia, and possibly embezzlement.

Another disturbing case involved an L1A applicant whose
companies FPU investigated and discovered that they were
operational neither in the U.S. nor in Russia. She insisted the
companies were real, but her own description of their dates of
operation - for about three months in the past three years -
along with her ignorance about any detail of the companies'
operations, though she claimed to be the CEO and president,
undermined her story. Additionally, her husband, the L2
applicant, is a well-known, high-level public official, and,
according to press articles, is under investigation for the
misuse of around USD 11 million from the public purse.

One H1B applicant misrepresented her qualifications for a
position as credit specialist at a bank. She would have been
the U.S. company's first employee after the petitioner, himself
a St. Petersburg native. During her interview, the applicant
stated that the petitioner, who lives in Russia, was a longtime
friend of her mother. Further investigation revealed fake lease
agreements provided by the petitioner, raising the suspicion
that the company is a shell company created for immigration
purposes.


C. IV FRAUD: N/A


D. DV FRAUD: N/A


E. ACS AND U.S. PASSPORT FRAUD: Among post's CRBA
applications, there have been multiple applications in the
reporting period for children born out of wedlock to American
citizen fathers. While this itself is not remarkable, post has
noticed that one or both parents in such cases has not disclosed
a prior (or continuing) marriage to a third party; other
discrepancies were then discovered when looking further into the
parents' claims. Out of concerns that the American citizen may
not be the biological father of the child in each case, post
conducted in-depth interviews and, in at least one case, the
parents agreed to do voluntary DNA testing. As these cases are
not yet resolved, post will report further if fraud is confirmed
in these cases.


F. ADOPTION FRAUD: N/A


G. USE OF DNA TESTING: N/A


H. ASYLUM AND OTHER DHS BENEFIT FRAUD: N/A


I. ALIEN SMUGGLING, TRAFFICKING, ORGANIZED CRIME, AND TERRORIST
TRAVEL: Per reftel, we regularly receive applicants with P3A2
lookouts for suspected ties to organized crime. If VO/L/A were
to request further information in response to an advisory

ST PETERSB 00000043 003 OF 003


opinion request, Post would have limited resources to
investigate P3A2 claims: FPU and ARSO-I in St. Petersburg have
no opportunity to actively investigate outside the confines of
the Consulate and are totally reliant on information provided by
the Russian police.


J. DS CRIMINAL FRAUD INVESTIGATIONS: FPU cooperates closely
with ARSO-I on issues related to local law enforcement,
organized crime, financial crime and terrorism, and during
investigations of US-based companies and financial transactions.


One example of such cases under investigation by the ARSO-I is
the company Main Bridge LLC, which petitioned for L1 visas for
its workers. Initial investigations revealed a false business
address in Russia and a false U.S. lease. Additional checks
identified at least three shell companies in Russia, British
Virgin Islands, and Germany, and false invoices involving one of
the companies. Due to bank records submitted with the petition
that show financial transactions in excess of $1 million, Main
Bridge is suspected of being involved in a financial scheme and
laundering money.


K. HOST COUNTRY PASSPORT, IDENTITY DOCUMENTS, AND CIVIL
REGISTRY: Though rare, post occasionally uncovers applicants
who have altered their documents and identity in order to obtain
U.S. immigration benefits. A Senegalese applicant submitted
an altered passport. He had changed the date of expiration for
his passport along with the date of expiration of his Russian
visa, revealing that he was no longer legally permitted to stay
in Russia. The NIV unit also encountered an applicant with a
P2A1 lookout placed in the NIV system by Embassy Riga. The
applicant, applying for an NIV with his Russian passport,
purchased a Latvian passport for 100,000 euros in the late
1990s, allegedly for purposes of starting a business in Latvia,
though the applicant claimed this business never got off the
ground. The passport, which permitted him to travel through the
EU without a visa, was seized by German authorities in 2004.
FPU shared information on his application with the Latvian
consulate in St. Petersburg; the applicant has not yet been
convicted for his crime.


L. COOPERATION WITH HOST GOVERNMENT AUTHORITIES: Rossiya
Airline officials at Pulkovo Airport, using information we
forwarded them in a 2006 DHS alert on altered passports, called
us to thank us for that information, since it led to the
discovery of three Afghan nationals toting fake Portuguese and
Norwegian documents this quarter. The Afghans spoke neither
Russian nor English and were transiting St. Petersburg from
Dushanbe en route to Helsinki. It was Rossiya Airlines visa
control staff that suspected each passport book was fake, even
though they were of sufficiently good quality to escape
detection in Dushanbe. All three were detained and deported to
Tajikistan and apprehended by Afghan security officials.


M. AREAS OF PARTICULAR CONCERN: N/A


N. STAFFING AND TRAINING: The Fraud Prevention Unit has one
Consular Officer, one Fraud Prevention FSN, and one ARSO/I. The
FP FSN took the Fraud Prevention training course in November

2006. The Consular Officer attended the Fraud Prevention for
Managers training course at FSI in April 2008.
GWALTNEY