Texas Is Building a State-Level H-1B Enforcement Machine

What Happened

Over the first half of 2026, three branches of Texas state government have opened parallel tracks targeting H-1B visa use — creating the most aggressive state-level enforcement posture the program has ever faced. As [Bloomberg Law reported on June 24](https://news.bloomberglaw.com/in-house-counsel/texas-pushes-h-1b-enforcement-beyond-the-federal-status-quo), the combined effect of these actions could influence H-1B enforcement priorities well beyond the state's borders.

The push began in January, when reports of alleged H-1B "ghost offices" in North Texas — businesses that appeared to sponsor large numbers of H-1B workers while operating from residential addresses or vacant buildings — triggered a coordinated response from the governor, attorney general, and legislature.

The Three Enforcement Tracks

**Governor Abbott's directive.** On [January 27, 2026](https://gov.texas.gov/news/post/governor-abbott-launches-investigation-into-h-1b-visa-abuse), Governor Greg Abbott issued a formal directive to all state agency heads and public university leaders ordering an immediate freeze on new H-1B visa petitions. No state agency may file a new H-1B petition without written approval from the Texas Workforce Commission through May 31, 2027. Agencies were also required to submit detailed reports disclosing the number of petitions filed in 2025, current H-1B holders, job titles, countries of origin, visa expiration dates, and evidence of efforts to hire U.S. workers for those positions.

**AG Paxton's civil investigative demands.** On [January 28, 2026](https://texasattorneygeneral.gov/news/releases/attorney-general-ken-paxton-announces-sweeping-investigation-h-1b-visa-abuse-starting-three-north), one day after the Abbott directive, Attorney General Ken Paxton announced CIDs targeting three North Texas companies. The CIDs demanded employee rosters, financial statements, descriptions of services, and communications related to company operations. One company identified in media coverage — 3Bees Technologies Inc., registered to a single-family home at 130 Darbon Lane — had reportedly sponsored 27 H-1B visa holders despite having no apparent commercial activity at the address.

On [April 30, 2026](https://www.texasattorneygeneral.gov/news/releases/attorney-general-ken-paxton-takes-legal-action-part-investigation-nearly-30-north-texas-businesses), Paxton expanded the investigation to nearly 30 North Texas businesses. Named targets include Tekpro IT LLC, Fame PBX LLC, 1st Ranking Technologies LLC, Qubitz Tech Systems LLC, Blooming Clouds LLC, Virat Solutions Inc., Oak Technologies Inc., Techpath Inc., and Techquency LLC. The AG's office documented patterns including companies listing empty or unfinished buildings as worksites and advertising nonexistent products or services.

**House Speaker Burrows' study charge.** In [March 2026](https://www.texastribune.org/2026/03/26/texas-house-speaker-dustin-burrows-interim-charges-new-mexico-data-centers-property-taxes/), Speaker Dustin Burrows assigned the House State Affairs Committee an interim charge to examine whether Texas has sufficient visibility into employer use of the H-1B visa program. The charge directs the committee to review risks of foreign influence, intellectual property theft, data security, technology transfer, and access to sensitive systems or critical infrastructure, and to recommend protections for the 2027 legislative session.

The Legal Framework: Consumer Protection, Not Immigration Law

A critical distinction for practitioners: no state has authority to administer or enforce the H-1B program itself. The H-1B program is governed exclusively by the [Immigration and Nationality Act](https://uscode.house.gov/view.xhtml?path=/prelim@title8/chapter12&edition=prelim) and federal regulations. USCIS enforces compliance through site visits, administrative subpoenas, and referrals to ICE.

Texas is not claiming immigration enforcement authority. Instead, the AG's investigations operate under the [Texas Deceptive Trade Practices Act (DTPA)](https://statutes.capitol.texas.gov/Docs/BC/htm/BC.17.htm), which allows the state to pursue civil penalties against businesses engaged in false, misleading, or deceptive acts. A ghost office that misrepresents its commercial operations — regardless of any immigration violation — can be targeted under state consumer-protection law.

This distinction matters because it means employers can face state enforcement even if their H-1B petitions were approved by USCIS. The state is not reviewing petitions; it is investigating whether the underlying business operations are real. As of the latest public reporting, all actions remain civil investigations. No criminal charges have been filed.

The Federal Enforcement Context

Texas's push comes as federal H-1B enforcement has already intensified. On [September 19, 2025](https://www.dol.gov/newsroom/releases/osec/osec20250919), the Department of Labor launched [Project Firewall](https://www.dol.gov/agencies/whd/immigration/h1b/projectfirewall), a Wage and Hour Division initiative where the Secretary of Labor personally certifies the initiation of investigations — a first in DOL history. Project Firewall targets displacement of U.S. workers, bad-faith recruitment, retaliation against complainants, and wage violations, with penalties including back wages, civil fines, and debarment from future H-1B use.

Congress is also weighing action. The bipartisan [H-1B and L-1 Visa Reform Act of 2025 (S.2928)](https://www.congress.gov/bill/119th-congress/senate-bill/2928/text), introduced by Senators Chuck Grassley (R-Iowa) and Dick Durbin (D-Ill.) with support from Senators Tommy Tuberville (R-Ala.), Richard Blumenthal (D-Conn.), and Bernie Sanders (I-Vt.), proposes new wage, recruitment, and attestation requirements; a searchable DOL job-posting database for H-1B openings; and authorization for 200 additional DOL enforcement staff. The bill remains in the Senate Judiciary Committee.

Meanwhile, the $100,000 H-1B proclamation fee — [vacated by a federal court but reinstated pending appeal](https://haven-five-hazel.vercel.app/blog/h1b-fee-stay-first-circuit-appeal-june-2026) — and the [wage-weighted FY 2027 lottery](https://haven-five-hazel.vercel.app/blog/h1b-wage-weighted-lottery-fy2027-results) have added further compliance pressure. The cumulative effect is that employers face scrutiny from more directions, at more levels of government, than at any point in the H-1B program's history.

Who Is Affected

The Texas investigations are focused on North Texas, but the enforcement patterns they target exist nationwide. Any employer whose H-1B petitions do not accurately reflect their day-to-day operations faces increased risk.

• **Staffing and consulting firms** that place H-1B workers at third-party client sites — these face the highest scrutiny because the petition worksite may differ from where the worker actually performs duties.
• **Small employers and startups** with limited physical footprints — companies operating from co-working spaces, virtual offices, or residential addresses may draw the same pattern-matching that flagged North Texas ghost offices.
• **Employers with remote H-1B workers** — the shift to remote work has created new worksite documentation challenges. If the petition lists one address but the worker routinely performs duties at another location, the discrepancy is exactly what investigators look for.
• **State government and public universities in Texas** — directly affected by the Abbott freeze. Any new H-1B petition requires TWC written approval through May 2027.
• **Employers outside Texas** — while the CIDs are limited to Texas jurisdiction, the patterns being investigated align with federal USCIS and DOL risk indicators. A successful Texas enforcement model could be adopted by other states' attorneys general.

What Attorneys Should Know

The legal architecture here is important. The AG's CIDs are issued under the DTPA, which has its own procedural requirements separate from federal immigration enforcement. Employers receiving a CID have a legal obligation to respond but should do so through Texas litigation counsel — not immigration counsel alone — because the questions at stake are about business operations, not immigration compliance per se.

Several aspects of the Texas approach warrant close monitoring. First, the state's consumer-protection theory has not been tested in a contested proceeding. Whether the DTPA can reach alleged misrepresentations made to a federal agency (USCIS) — as opposed to misrepresentations made to Texas consumers — is an open question. Second, any state legislation emerging from the Burrows study charge could impose new reporting requirements or restrict state/local business incentives for companies using H-1B workers, creating fiscal exposure for employers in Texas.

Attorneys should also consider the interaction with federal enforcement. USCIS already uses data-driven targeting to identify fraud — the same ghost-office patterns Texas is investigating are federal risk indicators. A CID response provided to the Texas AG's office could be discoverable by or shared with federal agencies. Counsel should advise clients to treat a CID as a trigger for a comprehensive internal review, not just a response to the specific state demand.

What Employers Should Do Now

Whether or not your H-1B workers are in Texas, the enforcement trends highlighted here apply nationally. The following steps reduce exposure to both state and federal scrutiny.

• **Audit worksite accuracy.** Confirm that every active H-1B petition reflects the worker's actual, current work location. If the worker has moved to remote work or a different office since the petition was filed, file an amended petition (H-1B amendment) or, if required, a new H-1B petition reflecting the change.
• **Review Public Access Files (PAFs).** The LCA and PAF are the first documents any investigator — federal or state — will ask for. Ensure each PAF contains the current LCA, prevailing wage determination, actual wage documentation, notice of filing evidence, and benefits attestation. Missing or outdated PAFs are the lowest-hanging enforcement target.
• **Verify business operations documentation.** Maintain current business licenses, commercial lease agreements, utility bills, and evidence of actual business operations at the address listed on H-1B petitions. The ghost-office investigations specifically target the gap between a company's claimed operations and its physical reality.
• **Prepare for site visits.** Designate a knowledgeable point of contact at each worksite who can answer basic questions about the H-1B worker's role, supervision, and job duties. USCIS site visits are typically unannounced; state AG investigators may also visit.
• **Brief leadership on state enforcement risk.** General counsel and HR leadership should understand that H-1B compliance is no longer exclusively a federal matter. Companies with operations in Texas should proactively brief state compliance teams on the current enforcement posture.

What Comes Next

Several developments to watch in the coming months. The House State Affairs Committee's interim study could produce recommendations for the 2027 legislative session — including state-level reporting requirements for H-1B employers or restrictions on state/local incentives. Any resulting legislation would be the first of its kind and would likely face preemption challenges under the Supremacy Clause.

The AG's investigations remain ongoing. If Paxton's office files enforcement actions under the DTPA, the cases will test whether state consumer-protection law can reach alleged misrepresentations made in federal immigration petitions. The outcome could establish a template for other states.

At the federal level, the H-1B and L-1 Visa Reform Act (S.2928) and Project Firewall are on parallel tracks. If Congress acts on the Grassley-Durbin bill, the new federal requirements could either moot or amplify the Texas enforcement rationale. Employers should plan for a multi-jurisdictional compliance environment that is likely to get more complex, not less.