Another scheme involved employing close relatives of the CEO, which brought his family over 1 million dollars in the last two years.
The third company sent young interns to work on farms owned by its management members, as well as at wineries.
All these organizations used the J-1 program, which has become a source of numerous cases of exploitation and conflicts of interest, as the U.S. government failed to properly oversee this initiative.
Sponsors of this program were supposed to promote diplomatic relations and popularize American culture. They were obligated to protect the interests of over 150,000 young people who come to the U.S. each year, helping them find jobs and ensuring their safety during their stay.
However, as the New York Times investigation revealed, some sponsors charged unsuspecting interns exorbitant fees, made deals with employers they were supposed to monitor, and ignored facts about unsafe working conditions.
According to tax returns, one of the leaders of the sponsoring groups earned over 1 million dollars a year. Other sponsors created health insurance companies and required interns to purchase services from them, profiting from the program.
Some sponsors also sent employers on free trips to recruit new employees, which did not violate any rules, as sponsors had broad authority regarding fee collection and employer verification.
At one point, even a private investment company was able to acquire a stake in one of the major sponsoring organizations, which was characterized as an "expansion of market presence."
The State Department repeatedly raised concerns about profit-making within the program but did not respond to its own warnings. An audit in 2000 found that some sponsors existed solely for profit and that the program was partially "out of control."
Among more than 120 sponsoring organizations, from universities to small NGOs, many have good reputations. However, representatives of the sponsoring industry argue that most program participants were grateful for the experience they gained in the U.S.
“I can’t imagine a more successful government program,” said James P. Pellow, executive director of the Council on International Educational Exchange. He noted that without this program, foreign students would not have the opportunity to learn about American values.
Nevertheless, during interviews and legal proceedings, many participants reported that they went into debt to pay the sponsors' fees, who lured them in with promises of unique opportunities.
Donho Kan, a student from South Korea, stated that in 2023 he paid nearly 5,000 dollars to the J-1 Visa Exchanges sponsor based on their advertising promises. Ultimately, he was sent to a steel mill in Indiana, where he received minimal training and was forced to perform dangerous work, as stated in his lawsuit.
The sponsor declined to comment, citing the ongoing litigation.
Despite the transformation of the program, it remains protected from many rules that apply to other similar programs. For example, workers with H-2B visas are prohibited from paying employment fees to avoid forced labor.
However, there are no such prohibitions for the J-1 program, and some sponsors charged up to 5,000 dollars for each application.
Many sponsors ignored interns' requests for help when they encountered problems at their workplaces.
“It’s a serious conflict of interest when sponsors have to be both recruiters and advocates for workers’ rights,” noted Daniel Costa, an expert from the Economic Policy Institute. “Sponsors have a financial interest in maintaining relationships with employers, while interns come and go.”
A State Department representative commented that the agency has been reforming and monitoring sponsors, excluding those who do not comply with the rules.
“Digging up old complaints to criticize the current work of the department is outrageous,” said the representative. “Under the Trump administration, the State Department ensured that the program complied with all legal requirements.”
In recent years, sponsors have actively lobbied for the expansion of the J-1 program. Today, over 300,000 people come to the U.S. annually on J-1 visas, compared to 65,000 in the 1980s.
Ema Kurshumlia, a student from Kosovo, paid about 2,000 dollars for an internship in New York in 2018. “We were promised a wonderful experience,” she recalls, adding that the work was hard and did not meet expectations.
Starting a Business
In 1990, David Dahl, a former wrestling coach, founded a nonprofit organization called the World International Student Exchange Fund, beginning to recruit foreign students for work in the U.S.
Over time, his business expanded despite accusations of exploiting interns. His business model was based on contacts with employers at overseas conferences.
As he recounted in an interview, at first his organization barely made ends meet, but by 2007, revenues reached 3.5 million dollars, and his personal earnings were 134,000 dollars a year.
By 2023, the nonprofit employed over 3,300 workers and generated 4.9 million dollars, while Dahl's salary exceeded 520,000 dollars.
However, for many years, only family members served on his board of directors.
In 2012, reports emerged that the WISE fund was hiring foreign students to work under harsh conditions at a processing plant in Alaska.
It is unclear whether the State Department took action against Dahl, but such practices continued thereafter.
In 2018, foreign interns who paid the WISE fund 2,000 dollars found themselves in a greenhouse, where they faced sexual harassment and injuries.
In 2019, another group of interns reported that the fund sent them to a pig farm in Nebraska, where they worked 12 hours a day without training and faced threats of deportation, according to internal State Department letters.
“I had issues with the work schedule and injuries, and I couldn’t go to the hospital,” said one participant.
Interns felt like “slaves,” as stated in the letters, and although they requested an investigation, WISE representatives only held a meeting with the employer.
The State Department was so concerned about the situation that it reached out to Dahl with questions about violations by his organization.
In response, Dahl noted that his group would advise the farm regarding the program's goals, but the following year even more students were sent there.
In an interview, he stated that his organization did not make excessive profits, and the fees for attracting new participants were lower than those of competitors.
Dahl defended his practice, claiming that the WISE fund strictly adheres to government requirements and that participants sometimes have idealized views of America.
“It’s a great program for youth, allowing them to gain experience,” he added. “Is it perfect? No, but perfection doesn’t exist.”
Profit and Conflicts of Interest
The Times analyzed the activities of over 120 sponsors involved in J-1 programs and found that cases of excessive profit-making and conflicts of interest are widespread.
The CEO of the Council on International Educational Exchange, one of the major sponsors, earned over 1.2 million dollars last year, attracting 28,000 interns.
He also reported that the council sends hiring managers on paid trips to meet students and conduct job fairs.
According to tax returns, another sponsor, ASSE International, paid its director 326,000 dollars, while he had a stake in a company that received over 200,000 dollars for recruiting students.
When the sponsor Alliance Abroad decided to “accelerate growth,” it sold a stake to a private investment company that also invested in power plants and other businesses.
Some sponsors created profitable side enterprises, including health insurance companies, and required participants to purchase insurance costing up to 100 dollars a month.
While sponsors are supposed to monitor working conditions, some received money from companies, hindering efforts to combat misconduct.
One organization, CAEP, charged employers fees for hiring foreign interns, creating a conflict of interest.
In 2024, a German agronomy student, Leander Weig, was hired on a farm in Oklahoma and sustained serious injuries due to an accident. He paid the sponsor 900 dollars for an internship that promised career advancement but instead returned home with severe injuries.
“I trusted CAEP. Working on that farm was a terrible experience,” said Weig.
The sponsor did not comment on the situation.
“Out of Control”
In 2000, the State Department's inspector general found that many sponsors were not fulfilling their obligations.
He noted that sponsors were making profits and that participation in the program needed to be reevaluated for those who merely acted as employment intermediaries.
In 2012, the inspector raised alarms again, pointing out that sponsors were allowed to charge any fees.
Despite this, no changes were made.
In 2013, Congress began discussing a bill that could prohibit charging employment fees within the J-1 program, but sponsors successfully opposed this proposal.
As a result, sponsors continue to charge fees without any restrictions, while the government conceals information about the costs of attracting participants.
More than a year ago, The Times submitted a request for information, but the State Department has yet to provide the data.
The full translation of the New York Times text "They Were Supposed to Protect Young Workers. Instead, They Cashed In."
