Infosys under Dept of Homeland Security scanner in US
April 23, 2012
First Published: 12:58 IST(23/4/2012)
Last Updated: 14:52 IST(23/4/2012)
Infosys, India's No. 2 software services exporter, is under scrutiny from the US Department of Homeland Security for likely errors in employer eligibility documents of its staff working in the United States, the company said in a statement.
File photo of a man walking past a billboard of Infosys' office in Bangalore.
The Department of Homeland Security (DHS) is reviewing the employer eligibility verifications on Form I-9, said Nasdaq-listed Infosys in an April 18 filing on the US Securities and Exchange Commission (SEC).
"In connection with this review, we have been advised that the DHS has found errors in a significant percentage of our Forms I-9 that the Department has reviewed," Infosys said in the SEC filing.
If the DHS concludes that the Forms I-9, used to verify the authorisation of employees to work in the US, contains errors it is likely to impose fines and penalties, the company said.
In January, Infosys said it was being investigated in Texas over its sponsorship and use of short-term US business visas.
Jack Palmer, a company employee, has reportedly accused Infosys of misusing the B1 visas to send employees from India to the US, its largest export market. Infosys has denied the reports.
Infosys said it could not estimate any loss it might incur from "unfavourable outcomes" related to the ongoing investigation and review.
"In the event that any government undertakes any actions which limit any visa program that we utilize, or imposes sanctions, fines or penalties on us or our employees, this could materially and adversely affect our business and results of operations," the company added.
Infosys, which reported its fiscal fourth quarter earnings on April 13, disappointed investors with weaker-than-expected revenue growth outlook for the fiscal year 2013 due to an uncertain global economy.
The news sent its shares plunging more than 12 percent in their biggest fall in nearly three years and wiped off more than $3 billion from the company's market value.