Monday May 11, 2009

Unlicensed immigration agents are using overseas addresses to get around new rules and others are liquidating their companies to avoid returning clients' fees, an inquiry alleges.

Local immigration agents have been required since last Monday to be licensed with the Immigration Advisers Authority or face fines of up to $100,000 and imprisonment of up to seven years.

Anton de Vrije, an investigator with Risk and Advisory Management, last week handed the authority his inquiry's findings, which he said focused on seven immigration companies, hundreds of clients and more than $13 million of transactions.

Mr de Vrije said the business of defrauding would-be immigrants was a "thriving underground industry" involving "hundreds if not thousands of victims".

He said some were subject to extortion by agents who demanded funds while holding their passports. Others had become overstayers and made destitute because of agents' false promises.

He was acting for 29 prospective immigrants, who included former clients of a now-defunct Christchurch-based firm and a second company. But he was not prepared to name all the firms at this stage because investigations are ongoing.

The Christchurch firm, which promised would-be immigrants employment for a fee of $3000 under a money-back guarantee, closed its doors last November leaving 229 clients $600,000 out of pocket, its liquidators said.

It then carried on business in the same premises under another name - but renounced any obligation to refund unhappy clients.

The second company has also been liquidated, with no money being paid to the migrants because they were not listed as creditors of the firm.

"This is typical of how a company defrauds would-be immigrants, and our investigations have shown that the client base of [the Christchurch firm] far exceeds the 229 figure shown in its books," Mr de Vrije alleged.

He said the second company had stopped trading under its New Zealand name but recently started using a firm registered in South Africa, to get around the new licensing requirements.

A director of that firm denied it was an attempt to "beat the system".

He said he had stopped using the New Zealand company because it was being wound up in response to current economic conditions, and did not submit his application to be licensed because it "wouldn't make economic sense" to do so.

Authority registrar Barry Smedts would not comment on what was discussed at the meeting with Mr de Vrije, but said most of the information received was about cases that happened between 2003 and 2006, and did not involve any currently licensed advisers.

Mr Smedts said licensing was mandatory only for individual advisers, but not for companies, and the authority was looking into about 80 issues involving advisers that might impact on licensing decisions.

Only 171 of the estimated 1200 immigration advisers in New Zealand had been licensed.

Immigration New Zealand will no longer accept migrants' applications lodged by unlicensed agents, but will still process those submitted before May 4.

Immigration New Zealand head Andrew Annakin said the service had set up an escalation process to help people who had yet to have an application lodged but had paid money to unlicensed consultants.

"Up to now, anybody could call themselves an immigration adviser, and some migrants have been ripped off," Mr Annakin said.

"The new law is a win-win situation for migrants and professional advisers and we will work through any teething problems to ensure no prospective migrant loses out."

(Source Herald Marketplace, Lincoln Tan)