In an industry where sub-contracting is common, IT staffing companies must be cautious in dealing with a sub-vendor that employs H-1b workers. There are a number of documented cases where those H-1b workers are not in status, not being paid properly, and in essence being held hostage by an unscrupulous vendor. In one recent case, a California man was sentenced to 15 months in Federal prison and fined over $500,000. In this case, the vendor had obtained over 100 H-1b visas for workers, illegally requiring them to pay fees to him for the process and never had jobs immediately available. He then paid no bench time and only started paying the H-1b workers once he found a sub-contract position. More details are available in the link above. The warning to reputable staffing firms is to know your vendors. And, when the USCIS does a site inspection, know that there is a reason.