State Department: Stronger Action Needed to Improve Oversight and
Assess Risks of the Summer Work Travel and Trainee Categories of 
the Exchange Visitor Program (14-OCT-05, GAO-06-106).		 
                                                                 
Exchange programs, which bring over 280,000 foreign visitors to  
the United States annually, are widely recognized as an effective
way to expose citizens of other countries to the American people 
and culture. Past GAO and the Department of State (State) Office 
of Inspector General reviews have reported that some exchange	 
visitors have participated in unauthorized activities and cited  
problems in the management and oversight of the programs. Strong 
management oversight is needed to ensure that the programs	 
operate as intended and are not abused. This report examines how 
State manages the Summer Work Travel and the Trainee programs to 
ensure that only authorized activities are carried out under the 
programs and identifies potential risks of the programs and the  
data available to assess these risks.				 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-106 					        
    ACCNO:   A39518						        
  TITLE:     State Department: Stronger Action Needed to Improve      
Oversight and Assess Risks of the Summer Work Travel and Trainee 
Categories of the Exchange Visitor Program			 
     DATE:   10/14/2005 
  SUBJECT:   Cultural exchange programs 			 
	     Exchange of persons programs			 
	     Internal controls					 
	     J-1 Visas						 
	     Program abuses					 
	     Program evaluation 				 
	     Program management 				 
	     Dept. of State Summer Work Travel			 
	     Program						 
                                                                 
	     Dept. of State Trainee Program			 
	     J-Visa Exchange Visitor Program			 
	     INS Student Exchange Visitor Information		 
	     System						 
                                                                 

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GAO-06-106

United States Government Accountability Office

GAO	Report to the Chairman, Subcommittee on Immigration, Border Security,
and

          Claims, Committee on the Judiciary, House of Representatives

October 2005

STATE DEPARTMENT

Stronger Action Needed to Improve Oversight and Assess Risks of the Summer Work
         Travel and Trainee Categories of the Exchange Visitor Program

                                       a

GAO-06-106

[IMG]

October 2005

STATE DEPARTMENT

Stronger Action Needed to Improve Oversight and Assess Risks of the Summer Work
Travel and Trainee Categories of the Exchange Visitor Program

                                 What GAO Found

State has not exerted sufficient management oversight of the Summer Work
Travel and the Trainee programs to guard against abuse of the programs and
has been slow to address program deficiencies. State attempts to ensure
compliance with program regulations through its processes of approving and
annually reviewing the organizations that sponsor exchange visitors. These
processes, however, are not sufficient to ensure that visitors participate
only in authorized activities because the procedures consist primarily of
document reviews, and State rarely visits the sponsors or host employers
of the exchange visitors to make sure they are following the rules to
investigate complaints. Moreover, some sponsors have asserted that the
program regulations need updating. Further, State officials believe that
the sanctions provided in the regulations are difficult to enforce. State
acknowledged that it has been slow to address identified deficiencies and
update the regulations, but had indicated that it is beginning to revise
the regulations and is establishing a unit to monitor exchange activities.
However funding of the unit has not been secured.

A number of potential risks are associated with the programs, including
that exchange visitors might use it to remain in the United States beyond
their authorized time. There is also the potential for the Trainee Program
to be misused as an employment program. Further, negative experiences for
exchange participants could undermine the purpose of the programs.
However, State has little data to measure whether such risks to the
program are significant. As a result, State cannot determine if additional
management actions are needed to mitigate the risks.

Summer Work Travel Participants and Trainee Participants, 2003 and 2004

                             Program                2003                 2004 
                         Summer Work                     
                              Travel              88,000              89,453a 
                             Trainee              31,084               27,475 

                        Source: The Department of State.

aAs of November 2004.

                 United States Government Accountability Office

Contents

     Letter                                                                 1 
                                          Results in Brief                  2 
                                             Background                     4 
                              State Has Maintained Limited Oversight of     9 
                                          Exchange Programs               
                               State Has Not Assessed Potential Risks      17 
                                             Conclusions                   23 
                                Recommendations for Executive Action       24 
                                 Agency Comments and Our Evaluation        24 
Appendixes                                                             
                Appendix I:             Scope and Methodology              26 
               Appendix II:     Comments from the Department of State      29 
              Appendix III:    GAO Contacts and Staff Acknowledgments      32 
                             Table 1: Top-10 Countries Participating in   
     Table                             the Summer Work Travel             
                                  and the Trainee Programs in 2004        
                               Figure 1: J-1 Visas Issued Fiscal Years        
    Figures                         1995-2004 Figure 2: Roles and         
                            Responsibilities of Sponsoring Organizations  5 7

Abbreviations

DHS Department of Homeland Security
OMB Office of Management and Budget
OIG Office of Inspector General
SEVIS Student and Exchange Visitor Information System

This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
its entirety without further permission from GAO. However, because this
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copyright holder may be necessary if you wish to reproduce this material
separately.

A

United States Government Accountability Office Washington, D.C. 20548

October 14, 2005

The Honorable John N. Hostettler

Chairman, Subcommittee on Immigration, Border Security, and Claims
Committee on the Judiciary House of Representatives

Dear Mr. Chairman:

Exchange programs are widely recognized as an effective way to expose
citizens of other countries to the American people and culture. According
to former Secretary of State Colin Powell, a good stay in this country is
the best public diplomacy tool the United States has. The Department of
State's (State) 2004 public diplomacy strategy calls for broader and
deeper use of exchanges-people-to-people contacts-that, according to the
strategy, can change hearts and minds. More than 280,000 foreign nationals
travel to the United States annually using a J-1 visa1 to participate in
the Exchange Visitor Program. This program encompasses 13 categories of
educational and cultural exchanges designed to enhance understanding
between the people of the United States and those of other countries.
Among the largest exchange programs are the Summer Work Travel Program,
which allows bona fide foreign college and university students to learn
about life in the United States through temporary work and travel, and the
Trainee Program, which, through a structured training program, allows
participants to enhance their skills in their chosen career field. State's
Bureau of Educational and Cultural Affairs administers the Exchange
Visitor Program through the Office of Exchange Coordination and
Designation. Past GAO and State Office of Inspector General (OIG) reviews
cited a few specific cases where J-1 visa holders participated in
unauthorized activities and cited problems in program management. In
particular, the OIG reported instances where companies were using exchange
visitors to fill regular staff positions and not trainee positions as
mandated by the Exchange Visitor Program regulations.2

1A J-1 visa is a nonimmigrant visa issued to foreign nationals to visit
the United States temporarily to teach, instruct or lecture, study,
observe, conduct research, consult, demonstrate special skills, or receive
training.

2Office of Inspector General, The Exchange Visitor Program Needs Improved
Management and Oversight, 00-CI-028 (Washington, D.C.: September 2000).

This report (1) examines how State manages the Summer Work Travel and the
Trainee programs to ensure that only authorized activities are carried out
under the programs and (2) identifies potential risks of the programs and
the data available to State to assess these risks.

To accomplish our objectives, we reviewed previous GAO and OIG reports and
examined current and proposed program regulations, State cables,
sponsoring organizations' annual reports, agency databases, and other
information pertaining to the Summer Work Travel and Trainee programs. We
also met with representatives of nine sponsoring organizations of the
Summer Work Travel Program that accounted for 75 percent of the
participants in 2004 and representatives of 13 sponsors of the Trainee
Program that accounted for 54 percent of the participants in 2004.
Additionally, we visited three overseas posts--Minsk, Belarus; Warsaw,
Poland; and Dublin, Ireland--where we discussed the programs with U.S.
embassy officials, including consular officers, and the overseas partners
of the U.S. sponsors of the exchanges. We selected these posts because
they are among the top sending countries for the Summer Work Travel
Program. We focused on the Summer Work Travel and the Trainee programs
because they bring in nearly one-half of the Exchange Visitor Program
participants. In addition, the Trainee Program was the subject of a 2000
OIG report. We conducted our review from November 2004 to August 2005 in
accordance with generally accepted government auditing standards. Appendix
I provides more information on our scope and methodology.

Results in Brief	State has not exerted sufficient management oversight of
the Summer Work Travel and the Trainee programs to ensure that only
authorized activities are undertaken. Sponsoring organizations, employers,
third-party organizations, and exchange visitors are required to comply
with the Exchange Visitor Program regulations. These regulations require,
for example, that sponsors monitor the exchange visitors to ensure that
they engage only in activities consistent with the Exchange Visitor
Program category listed on their certificate of eligibility. State
attempts to ensure compliance with the regulations through its processes
of designating and redesignating (every 2 years) organizations that
sponsor J-1 exchange visitors. However, the process of redesignating
sponsor organizations and the review of sponsors' annual reports are not
sufficient to ensure that visitors participate only in authorized
activities. State officials rarely visit the sponsors, host employers or
third-party organizations of the exchange participants to ensure
compliance with the rules or investigate complaints. For example, in the
last 4 years, State officials made just eight visits to its

206 designated Summer Work Travel and/or Trainee sponsors. Moreover, some
sponsors stated that the regulations need updating to clarify how the
programs should be implemented. In addition, State officials in charge of
the programs said the sanctions outlined in the regulations are difficult
to enforce. State is currently establishing a compliance unit and revising
the regulations, including developing new sanction regulations; but these
changes have not been fully implemented.

There are a number of potential risks associated with the Summer Work
Travel and the Trainee exchange programs. These include the potential risk
of (1) foreign nationals using the program as a means of entering the
United States and remaining illegally after their visa expires; (2) the
Trainee Program being misused as a work program; and (3) exchange
participants being exploited, resulting in negative experiences, which
could undermine the purpose of the programs. State and Department of
Homeland Security (DHS) officials and some sponsors that we met with
provided evidence of such abuse. For example, DHS and the overseas posts
provided data on potential overstays 3 that indicated that some exchange
visitors had remained in the United States after their programs concluded.
As an example of abuse of the Trainee Program, State and some of the
sponsors described an incident in which 650 electrical engineers entered
the United States to participate in training programs but were instead
employed on construction projects as electricians, contrary to the
program's intent. In another example, a State official described an
incident in which about 45 current Summer Work Travel participants were
placed in substandard housing, which was apparently leased by an employee
of the sponsoring organization. GAO internal control standards instruct
agencies to identify risks that could impede the efficient and effective
achievement of program objectives and assess their impact. However, State
has insufficient data to assess whether potential risks to the programs
are significant. For example, due to weaknesses in the DHS' system for
tracking visitors' arrivals and departures,4 the full extent of the
overstays is not known. Moreover, State does not systematically document
program abuse. Furthermore the State and the Department of Labor (Labor)
do not compile or analyze data concerning the potential impact of program
abuse on the

3An overstay is a foreign national who was legally admitted to the United
States as a nonimmigrant for a specific period but remained in the country
after that period expired.

4Weaknesses include noncollection of many departure forms that visitors to
the United States are required to submit when they leave the United States
and an inability to match departure forms to data on arrivals.

U.S. labor market, although Labor officials said that it is not likely
that the exchange programs will have any effect on U.S. employment
opportunities because of the small number of J-1 exchange visitors
relative to the U.S. workforce. Additionally, State does not know the
extent to which participants have negative experiences because it does not
systematically document and analyze reports of complaints made by program
participants and serious problems submitted by the sponsors.

This report recommends that the Secretary of State take the following
three actions to enhance the overall management and monitoring of the
Summer Work Travel and the Trainee programs:

o 	fully implement a compliance unit to better monitor Exchange Visitor
Program activities and address deficiencies;

o  update and amend the regulations where necessary; and

o 	develop strategies to obtain data, such as information on overstays and
labor market abuses, to assess the risks associated with the exchange
program categories, and use the results of its assessment to focus its
management and monitoring efforts.

In commenting on a draft of this report, State acknowledged weaknesses in
its oversight and administration of the Exchange Visitor Program and
reported that it has designated program oversight and administration as a
weakness under the Federal Managers Financial Integrity Act.5 State
described a number of actions it is taking to implement each of our
recommendations.

Background	The Mutual Educational and Cultural Exchange Act of 19616
authorizes the J-1 Exchange Visitor Program. The program provides foreign
nationals with opportunities to participate in exchange programs in the
United States and return home to share their experiences, while also
encouraging Americans to participate in educational and cultural programs
in other countries.

5The Federal Managers Financial Integrity Act of 1982 (P. L. 97-255)
requires agency heads to establish a continuous process for assessment and
improvement of their agency's internal control and to annually report on
the status of their efforts.

6P. L. 87-256, as amended, 22 U.S.C. S:2451 et seq.

Foreign nationals who participate in the program enter the United States
with a J-1 visa. The program has grown considerably over the years. Figure
1 shows the number of J-1 visas issued since 1995.

Figure 1: J-1 Visas Issued Fiscal Years 1995-2004 Visas issued in millions
300,000

250,000

200,000

150,000

100,000

50,000

0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Fiscal year

Source: GAO analysis of Department of State data.

The program is comprised of 13 categories of exchanges, which are grouped
under private sector programs or academic and government programs. The
private sector programs include the Alien Physician, Au Pair, Camp
Counselor, Summer Work Travel, and Trainee categories. The academic and
government programs include the Government Visitor, International Visitor,
Professor and Research Scholar, Short-Term Scholar, Specialist, Student
(Secondary School Student, College/University Student), and Teacher
categories. The Exchange Visitor Program had about 282,000 exchange
visitors in the 13 program categories for fiscal year 2004.

State's Bureau of Educational and Cultural Affairs administers the
Exchange Visitor Program through the Office of Exchange Coordination and
Designation. This office administers the program through the designation
of United States organizations to conduct exchange programs in the various
exchange categories. There are 1,457 designated exchange

programs. Designated sponsors are responsible for screening and selecting
qualified applicants for program eligibility. The office determines which
organizations will be designated to administer the international exchange
programs on the basis of information provided during the application
process in accordance with regulatory requirements. The office also
develops and administers policy and regulations for the exchange
categories and oversees sponsoring organizations' compliance.

Sponsors may be for profit or nonprofit organizations; businesses; state,
local, or federal government agencies; and education-related institutions.
Sponsors sometimes contract with overseas organizations-such as student
travel agencies-as local partners to help identify and screen exchange
program applicants. Some sponsors serve as intermediaries between the
exchange visitor and a third party, which engages the exchange visitor in
the program activity for the category in which they are being sponsored.
For example, for trainees, the third parties are the organizations where
the exchange visitors will receive training. Third parties consist of a
variety of organizations, which include-but are not limited to-hotels, law
firms, restaurants, Internet companies, and other private and public
sector businesses and organizations. Sponsors are responsible for
overseeing the operations of their overseas partners, and any third
parties they work with.

Also chief among the sponsors' responsibilities is that of managing
information on the exchange participant in DHS' Student and Exchange
Visitor Information System (SEVIS), which has been in operation since
January 2003. SEVIS, which is maintained and administered by DHS' U.S.
Immigration and Customs Enforcement, is an Internet-based system that
electronically collects information on all nonimmigrants that enter the
United States with student visas and exchange visitor visas, and their
dependents. Once a participant's data are entered into SEVIS by the
sponsor, a Form DS-2019 is issued by the system in the applicant's name.
This identifying information in SEVIS can be reviewed by a consular
officer at the time of the visa interview and during the processing of the
exchange visitor at the port of entry. Upon the arrival of the Exchange
Visitor Program participant, the sponsor is required to document their
participation in their program activity and record information on the
location of the visitor's employment or training and U.S. residence
address. Figure 2 describes the sponsoring organizations' roles and
responsibilities.

Figure 2: Roles and Responsibilities of Sponsoring Organizations

                                  Source: GAO.

  Summer Work Travel and Trainee Programs

The Summer Work Travel Program is among the largest of the 13 categories
of exchanges, with about 89,4537 participants in 2004. This program is
designed to achieve the educational objectives of international exchange
by involving bona fide foreign college or university students directly in
the daily lives of U.S. citizens through travel and temporary work
opportunities. The Trainee Program, with about 27,475 participants in
2004, provides foreign nationals the opportunity to enhance their skills
in their chosen career field through participation in a structured
training program. Summer Work Travel sponsors help the participants obtain
jobs8 and provide pre-arrival information, an orientation to life in the
United States, and contact information in the event of problems. Sponsors
of trainees are also required to provide pre-arrival information to the
trainees and are directly responsible for all aspects of the trainees'
program, including the selection, orientation, training, supervision, and
evaluation. About 52 Summer Work Travel and 170 Trainee sponsors operated
programs in 2005.9

Thousands of employers participate in the Summer Work Travel and the
Trainee programs. Typical Summer Work Travel employers include amusement
parks, resorts, hotels, and restaurants. The jobs generally include ride
operators, waiters, lifeguards, receptionists, and guides. The types of
organizations that utilize trainees include corporations, architectural
firms, hotels, restaurants, development organizations, airlines,
investment and financial services entities, and manufacturing companies.
The participants are placed in locations wherein they receive training in
engineering, drafting and design, biomedical technology, agricultural
technology, hospitality administration and management, marketing,
agricultural and food products processing, culinary arts and chef
training, financial management, and many other careers.

Throughout the existence of the Summer Work Travel Program, there has been
a geographic shift in which countries provide the most program
participants. In the past, Western Europe had the largest numbers of

7As of November 2004.

8Regulations require sponsors to ensure that at least half of their Summer
Work Travel participants identify jobs before they leave their home
country. The rest of the participants can look for jobs once they arrive
in the United States.

9Some sponsors are designated to administer exchange programs in more than
one exchange category. In 2005, there were 206 individual organizations
that sponsored the Summer Work Travel and/or the Trainee programs.

participants. However, more recently, the largest numbers of Summer Work
Travel participants have been citizens of Eastern European countries,
including Poland, Bulgaria, Czech Republic, and Romania. Table 1 lists the
10 countries with the largest numbers of Summer Work Travel and Trainee
participants.

Table 1: Top-10 Countries Participating in the Summer Work Travel and the
                            Trainee Programs in 2004

Summer Work Travel
Program Trainee Program

      Country     Number of participants    Country                 Number of 
                                                                 participants 
       Poland                     18,691    Germany                     3,021 
       Russia                      9,962     France                     1,748 
      Bulgaria                     6,993 United Kingdom                 1,023 
      Slovakia                     5,581     Canada     
       Brazil                      5,477     China      
      Ireland                      4,309  Netherlands   
Czech Republic                  3,053     Mexico     
        Peru                       2,978     Japan      
      Romania                      2,901    Ireland     
      Belarus                      2,607     India      

                          Source: Department of State.

  State Has Maintained Limited Oversight of Exchange Programs

State has not exerted sufficient management oversight of the Summer Work
Travel and the Trainee programs to guard against abuse of the programs.
State primarily ensures compliance with program regulations through a
paperwork review, and there is inconsistent monitoring by sponsors.
Moreover, some sponsors believe that the program regulations need
updating, and State officials have expressed concerns about the
enforceability of the sanction/revocation process provided for in the
Exchange Visitor Program regulations. Sponsors have also expressed concern
about their communication with State. State has acknowledged problems, is
establishing a compliance unit to monitor program activities, and is
revising the regulations; however progress has been slow.

    State's Monitoring Efforts State's monitoring efforts largely consist of
  reviewing written information Are Minimal provided by sponsors, with minimal
                     efforts of verifying such information

through program visits. State relies on sponsors to provide written
information, primarily through annual reports, which describe the number
of individuals a sponsor has placed and a brief narrative on program
activities, difficulties encountered, and their resolution. Exchange
program regulations require that sponsors promptly notify State about any
serious problem or controversy that could cause State or the sponsor's
Exchange Visitor Program notoriety or disrepute. When a sponsor reports a
problem, State officials follow-up by telephone, e-mail, fax or letter,
according to sponsors and State officials. However, State rarely visits
sponsors to observe program activities and verify the information that
they provide, although such visits are a good internal control practice
for ensuring that management's directives are being carried out. We found
that in the past 4 years, State officials made visits to only 8 of its 206
Summer Work Travel and/or Trainee sponsors.

Additionally, information on problematic incidents provided by the
sponsors and any notes or correspondence on the matter are filed as part
of the material that is examined when the sponsor applies for
redesignation, which is required every 2 years.10 In their applications
for redesignation to State, all sponsors are required to estimate the
number of exchange visitors their organization would like to place and
provide information on their legal, financial, and managerial resources to
manage exchange programs in compliance with federal regulations. State
reviews these applications along with the annual reports and other
documentation collected over the 2-year period and determines whether it
should grant a 2-year designation to a sponsor and the number of
participants the sponsor will be authorized to include in their exchange
program activity. The vast majority of sponsors who apply for
redesignation are approved. State officials said that their staffing
levels and lack of travel funds do not allow for intensive monitoring of
the Exchange Visitor Program sponsors. The Office of Exchange Coordination
and Designation has five Program Designation officers who serve as the
point of contact and are responsible for the day-to-day administration and
management of the 13 exchange programs.

10According to the program regulations, sponsors' designations are
effective for 5 years, although State may designate a shorter period. The
Enhanced Border Security and Visa Entry Reform Act of 2002 (P.L. 107-173)
requires State to conduct a review every 2 years of the entities
designated to sponsor exchange programs to determine if they are in
compliance with certain recordkeeping and reporting requirements. State
designated all sponsors for 2 years when they were entered in SEVIS in
January 2003. State has drafted revisions to its regulations that will
reflect the change in the period of designation from 5 to 2 years.

Sponsors' Monitoring of Employers and Third Parties Is Limited

Exchange Visitor Program regulations require sponsors to effectively
administer and monitor their Exchange Visitor Program and ensure exchange
participants engage in activities consistent with the appropriate exchange
category. Nevertheless, recent discoveries by consular officers overseas
suggest that some sponsors do not consistently carry out their oversight
and monitoring responsibilities. For example:

o 	A trainee applicant submitted a training offer that included the name
and organizational information of a legitimate financial services company,
but listed as a contact an individual with a noncompany e-mail address.
When the consular officer checked the contact information, he learned that
the contact person was not affiliated with the financial services company.
The sponsor admitted to only spot-checking the viability of third party
organizations and training plans.

o 	When a consular officer at another post checked a company's Web site to
verify the job offer of a foreign student applying for the Summer Work
Travel Program, he discovered that the company was a topless bar.

o 	In another case, consular officers noticed a number of trainee
applicants who said they were going to the United States to work as
kitchen help and wait staff. When State contacted the U.S. sponsor about
these applicants, the sponsor stated that it relied on another
organization to help it select and place the trainees and admitted that it
had not followed up directly with each trainee and employer to ensure that
its standards were being satisfied.

Sponsors are required to take all reasonable steps to ensure that third
parties know and comply with applicable provisions of the Exchange Visitor
Program regulations. However, State does not offer any guidance on how the
sponsors should carry out their monitoring and oversight responsibilities.
Two of the sponsors we met with said that, after they discovered that
trainees whom they had sponsored were not receiving any training, they
established new practices to visit at least 10 percent of their exchange
program participants and all employers and exchange participants where
there were problems.

  Various Concerns Exist About Program Regulations

During our review, several sponsors we met with raised concerns about the
clarity of the program regulations and also complained that varying
interpretations of the regulations make it difficult for them to implement
the program. Moreover, State officials believed that the sanctions
provided in the regulations are not adequate to control the activities of
sponsors who incorrectly implemented the program. State has been revising
the regulations but has not finalized the changes.

Regulations Need Revising	Six of the 13 sponsors that we met with
described a range of problems pertaining to the regulations, particularly
regarding the Trainee Program. Their comments included the following:

o 	The Trainee regulations lack specificity and are open to differing
interpretation by State and the sponsors.

o 	Dealing with State has become more complicated for sponsor
organizations because State has at times changed rules outside of the
formal regulation-setting process.

o 	The Trainee regulations are so cumbersome that it is unclear what
should be included in a training plan.

o 	Training plans vary widely among sponsors, and there is no guidance on
what constitutes a good plan.

o  The regulations should include a separate category for interns.

A past OIG report also cited problems with the regulations and recommended
in particular that, for the Trainee Program, the training regulations
should more clearly define what is not considered training.11

Six of the sponsors we met with and the representative of an association
of sponsors expressed concern with State's interpretation of certain
provisions of the regulations, while seven sponsors and the association
representative also said that State does not consistently disseminate its
interpretations or guidance on the regulations to the sponsors. For
example, the regulations state that the maximum period of the
participation in the Exchange Visitor Program for a trainee, with the

11OIG OO-CI-028.

exception of flight training, shall not exceed 18 months. Some sponsors
said they interpreted this provision to mean that an individual could come
to the United States one or more times as a trainee as long as the
combined duration of the visits did not exceed 18 months. In 2002,
however, some sponsors said they were told that the Trainee Program was
restricted to a one-time training session not to exceed 18 months. This
clarification in regulations has surprised some sponsors, according to one
of the sponsors who was notified about this change through a fax from
State. A State official explained that all Trainee sponsors were sent a
message through SEVIS in October 2003, explaining State's policy on this
matter. According to the documentation, the message was to be addressed to
all sponsors that conduct Trainee programs and all responsible officers
and their alternates.

Moreover, a few sponsors said guidance or interpretations of various
provisions of the regulations have been communicated inconsistently. For
example, representatives of two sponsoring organizations said that State
is no longer requiring that sponsors recruit no more than 10 percent of
repeat Summer Work Travel participants, as specified in the regulations,
but State did not make any formal effort to inform the sponsors of the
change. One of the sponsors said that the organization learned about the
change from the U.S. Embassy in Warsaw. A State official explained that
policy changes are announced in the Federal Register or by written notice
to all sponsors. According to the official, two cables were sent to all
overseas posts clarifying the requirements of the Summer Work Travel
Program and the removal of the 10 percent rule regarding repeat
participants. In addition, copies of these cables were sent, by e-mail, to
all Summer Work Travel sponsors, according to the official.

State Officials Believe State is also reviewing the sanctions provided in
the regulations. State Regulations Lack Enforceable officials, including
the Principal Deputy Assistant Secretary of the Bureau

Sanctions

of Educational and Cultural Affairs, said the current sanction/revocation
process that State may use to limit the activities of sponsors that do not
comply with the regulations-or remove a sponsor from the program
altogether-is difficult to enforce. The sanctions range in severity from a
letter of reprimand to an action to revoke a sponsor's designation. One
sanction that State uses is to deny the sponsor's request for
certification forms until the compliance issue has been resolved. For
example, State officials described a recent case in which State's attempt
to revoke a sponsor's designation was challenged by the sponsor in
district court. In this case, State received complaints from two trainees
who alleged they were not receiving the training that they had expected
and were displeased with their training assignments and compensation. The
sponsor in this case

had placed individuals in positions in the hospitality industry. State
investigated the sponsor's operation, interviewed a number of program
participants, and concluded that the sponsor was not placing participants
in management training positions but was operating a work program, in
violation of the regulations. State's in-house revocation board agreed and
supported the sanction of revocation. However, in remanding the matter to
the board for further proceedings, the district court concluded that
State's investigation had been too limited and had not produced evidence
adequate to support the severe punishment of revocation. After a second
hearing, the board overturned the revocation, thereby enabling the sponsor
to resume its program. State concluded that the sanctions' provisions
needed streamlining and tightening for more effective and assured
application.

State Slow to Revise Regulations 	State has acknowledged that the
regulations need revising; however, more than 3 years after revisions were
suggested by the exchange industry they are still in draft form. According
to the Acting Director of the Office of Exchange Coordination and
Designation revisions are in process. For example, State is revising the
Trainee regulations to create a separate Intern category to accommodate
younger, less experienced applicants, such as students or recent
university graduates seeking to gain practical work experience. The
exchange community generally supports the creation of a new Intern
category and, in November 2001, an association of organizations that
sponsor exchange students submitted its proposals for revising the
regulations to State. The Acting Director of the Office of Exchange
Coordination and Designation said that the sections of the regulations on
interns and trainees are still being reviewed at State and attributed the
delay in completing the regulations to the review process. He also stated
that State's Office of Legal Advisor was given the responsibility to
develop new sanctions for the program 2 years ago. According to the
Assistant Legal Advisor for Public Diplomacy and Public Affairs, revised
sanctions regulations were drafted and shared with the Bureau of
Educational and Cultural Affairs for review and comment. The Assistant
Legal Advisor stated that recent guidance from the Bureau's Principal
Deputy Assistant Secretary suggested that further revisions were warranted
to best suit evolving program needs. Once State has completed its review,
the Department of Justice will be consulted prior to publication of the
revised regulations. She stated that while this process could take an
additional 2 to 6 months to complete, the timing should fall well within
the time lines and milestones set forth in a 24-month corrective action
plan proposed by the Bureau in March 2005.

  Communication between State and Sponsors and with Posts Has Raised Concerns

According to GAO guidance on internal controls, managers should ensure
that effective external communications occur with groups that impact its
program, projects, operations, and other activities. According to seven of
the sponsors we met with and the organization representing sponsors,
communication with State is a problem. For example, one sponsor described
State as reactive rather than proactive in its communication practices.
Representatives of four of the sponsoring organizations complained that
program officers were not always responsive to their inquiries or were
difficult to reach. Some sponsors attributed the difficulties to an
insufficient number of State staff.

Some sponsors also complained about a lack of feedback from a study
commissioned by State on SEVIS compliance and other issues, which was
completed in December 2003. The report concluded that in some cases the
sponsors' staff was not adequately trained, that the sponsors did not
maintain required records, and did not fully provide oversight of their
foreign partners, employers, third-party organizations, or the exchange
participants. The report made a number of recommendations on how State
should further clarify the program regulations and help train the sponsors
on both State regulations and their role in maintaining SEVIS data. We met
with six sponsors that participated in the study, and none had received
feedback from State on the results of the study. One said the Acting
Director of the Office of Exchange Coordination and Designation made some
general comments about the study at a meeting of an industry association.

Communication between the Office of Exchange Coordination and Designation
and the overseas posts has also been cited as a concern. For example, one
sponsor said there is no mechanism to ensure consistent interpretation of
the regulations by the overseas posts, while another said the posts are
the last to know about program changes. For example, a sponsor said that
even though the office has told them that applicants can have only one
trainee placement, one post was still telling applicants in 2004 that they
can participate more than once. Further, a representative of an exchange
industry organization stated that the Office of Exchange Coordination and
Designation knows too little about what is really going on in the field.
This situation may have been the reason ineligible students from at least
one country, Ireland, were allowed to participate in the Summer Work
Travel Program for over 30 years before an apparent misinterpretation of
the regulations was discovered. In 2002, a consular officer in Dublin
asked for clarification on the eligibility of students who had completed
their course work but had not formally graduated,

according to an embassy official. In response, State instructed the posts
not to change their selection procedures for the 2003 season. However,
according to the Acting Director of Office of Exchange Coordination and
Designation, State ultimately confirmed that such students were not
eligible for the program, unless they could demonstrate enrollment in
another degree program, and sent a cable to the posts with its decision in
2004. According to the local program representatives, such students had
constituted up to a third of the participants from Ireland.

  Establishment of a Compliance Unit Not Fully Implemented

State has been slow to implement the OIG's 2000 recommendation that it
devote the necessary resources to perform more rigorous oversight. The
Principal Deputy Assistant Secretary of the Bureau of Educational and
Cultural Affairs and the Acting Director of the Office of Exchange
Coordination and Designation acknowledged that State has been slow to
establish a compliance unit. The Acting Director of the Office of Exchange
Coordination and Designation said funding to establish a compliance unit
has been requested for several years without success. The Bureau requested
funding in fiscal years 2002 and 2003 for five additional positions for
the compliance unit, but State did not approve the request for submission
to the Office of Management and Budget (OMB), according to a State
official. The Principal Deputy Assistant Secretary of the Bureau of
Educational and Cultural Affairs stated that the unit was not funded
initially because of a lack of senior managerial support. State has since
supported the request for funding because of congressional interest and
the increased emphasis on strengthening program management, according to
the Principal Deputy Assistant Secretary. Subsequent requests for funding
for the unit for fiscal years 2004 to 2006 were approved by State but not
approved by OMB. However, the officials told us they realized that the
program regulations have been ignored by some exchange program sponsors,
agreed that a compliance unit was needed, and are in the process of the
establishing the unit by diverting existing positions.

According to State officials, the unit as it is currently conceived would
initially consist of one Foreign Service officer and two program analysts
and will report to the Principal Deputy Assistant Secretary. The officials
stated that the compliance unit will rely on structured reviews conducted
by contractors. They said State will utilize the system currently in place
at DHS, which uses contractors for on-site reviews of schools to verify
their eligibility to register foreign students into the SEVIS system. The
contractors will verify the information that the sponsors submit as part
of the redesignation process and may check the names of the responsible
and

alternate responsible officers-and possibly board members-through law
enforcement databases, according to the State officials. They said that as
part of the new compliance effort, sponsors for all nonacademic exchanges
will be required to contract for and submit annual audits of their
activities. The compliance unit will develop a management template to
guide the audits. Currently only sponsors of the Au Pair Program are
required to submit such audits.12

It is too early to determine whether implementation of the planned
compliance unit will resolve all of the issues identified by GAO and OIG.
For example, using contractors to visit the sponsors will address OIG's
criticism that State does not visit the sponsors. However, State has not
determined what information the contractors need to review to assess how
well the sponsors monitor employers and third parties. Moreover, State has
not provided a written plan describing in detail how the compliance unit
will operate. Funding also remains an issue. State initially plans to
cover the cost of the new compliance unit by redirecting current
appropriations and obtaining-as agreed upon by OMB-about $450,000 of the
SEVIS fees collected from exchange program sponsors by DHS. Further, State
will again request funding for the compliance unit in the 2007 budget
request.

  State Has Not Assessed Potential Risks

GAO internal control standards instruct agencies to identify risks that
could impede the efficient and effective achievement of its objectives and
assess their impact. A number of potential risks are associated with the
Summer Work Travel and the Trainee programs, including the risk of
participants using the programs to remain in the United States beyond
their authorized time. Exchange participants may also use the programs as
a means to fraudulent immigration. There is also the potential for the
Trainee Program being misused as an employment program, although State
does not have data on the extent that such abuse occurs. The exchange
participants could be exploited by employers or other third parties. While
State investigates complaints, it does not know the extent to which
participants have negative experiences because it does not systematically
document and analyze complaints made by program participants and reports
of serious problems reported by the sponsors.

12Compliance unit staff will analyze the results of the contractor reviews
and the audits, although a regulatory change is needed to implement the
audit requirement, according to the Acting Director of the Office of
Exchange Designation and Coordination.

  Some Exchange Participants Have Used the Programs to Remain in the United
  States

Although exchange program participants are expected to return to their
country following completion of their program, there is information
indicating that some participants remain beyond the time that they were
authorized to stay. Information on overstays is available from DHS's
arrival and departure database and the results of returnee validation
studies conducted by overseas posts. For example, we asked DHS to check
the total number of J-1 visa recipients in all exchange categories who had
completed their program since January 2003 against its arrival and
departure database to determine which visa holders had departed the
country. The results showed that about 362,000 exchange participants had
concluded their program during this period. The data showed that about 36
percent of the participants had departed the United States by the end of
their program and about 24 percent were potential overstays.13 However,
the full extent of overstays is uncertain because DHS could not find
information on an additional 40 percent of the J-1 visa holders because
they may have entered the United States before the current entry system
was operational. DHS' primary method for estimating overstays is to match
the arrival portion of a form collected by DHS when the visitor enters the
United States to the departure portion of the form generally collected by
the airlines when the visitor departs. One of the weaknesses in this
system is that the departure portion of the form is not always submitted
to airline staff. Further, data entry errors by DHS contractors also make
it difficult to match the forms. The U.S. government is phasing in a more
comprehensive entry-exit system, US-VISIT, to correct the weaknesses in
its current system.

Some overseas posts periodically conduct validation studies to determine
if visa applicants who received J-1 visas at their post have returned to
that country. These studies generally consist of telephone inquiries to
the visa recipient, while some posts have required J-1 visa recipients to
report to the post upon their return. The results vary. For example, one
post in the former Soviet Union conducted a study of its 2004 Summer Work
Travel season that showed that, as of January 20, 2005, 26 percent of the
2004 participants from that country remained in the United States. This
post reported overstay rates of 29 percent for 2003, 25.6 percent for
2002, and 27 percent for 2001. Other posts have reported lower overstay
rates. For example, a post in a Western European country conducted a
validation

13Some of these individuals may have changed their immigration status
legally. DHS would need to analyze each individual record to determine if
these individuals were actually overstays.

study of its 2004 Summer Work Travel Program that showed that all of the
visa applicants in the sample who were issued J-1 visas returned home, as
required. The posts can use the results of such studies to guide their
decision making when they adjudicate visas. For example, the post with a
26 percent overstay rate in 2004 developed additional selection factors
for the 2005 Summer Work Travel season to assess the potential for
individuals to return to their country after their programs are completed.
However, these studies are not always statistically valid. Moreover, the
Acting Director of Exchange Coordination and Designation said the post
validation studies are not useful to program officials because the posts
do not follow a standardized methodology.

J-1 visitors who remain in the United States beyond their program do not
necessarily stay for long periods of time, and not all of them remain in
the United States illegally. According to consular officials we talked
with at one post, some participants in the Summer Work Travel Program from
their country who remain in the United States beyond their program date
might typically overstay anywhere from a few days to no more than a few
months. The consular officials said the participants sometimes remain in
the United States longer if they have not earned sufficient money to cover
their expenses. Others change their visa status to another nonimmigrant
category. For example, the 2004 validation study by one post in the former
Soviet Union country showed that 39 percent of those who had remained in
the United States beyond the completion of the program had either changed
their visa status, got married, or were seeking asylum. Changing status
from a J-1 visa to another visa category is permitted under U.S.
immigration laws in certain circumstances, but Bureau of Consular Affairs
and other officials have stated that it is not the intent of the program.

  Potential Exists for Fraudulent Immigration Claims

DHS data show that a growing number of J-1 visa holders had applied for
political asylum between 1995 and 2004, about 6,300 individuals who
entered the United States with J-1 visas applied for asylum. According to
DHS, the numbers of asylum applications from J-1 visa holders from former
Soviet Union countries have more than doubled since 2000. These countries
include Russia, Belarus, Armenia, and Ukraine. The officials are concerned
that some of these claims are fraudulent, as they doubt that J-1 visa
holders-who have to be students in good standing in their countries-are
being persecuted. The recent increase in numbers of such claims and the
similarities of the stories-which indicate coaching, are also indicators
of fraud, according to DHS officials. DHS' Fraud Detection and National
Security Unit and State's Bureau of Consular Affairs Office of

Consular Fraud Prevention are monitoring this issue. These units would
turn over any suspected fraud to U.S. Immigration and Customs Enforcement
for investigation. According to a DHS official, U.S. Immigration and
Customs Enforcement is conducting asylum fraud investigations in Los
Angeles and Cleveland. Among the targets of those investigations are
individuals who were admitted with J-1 visas, as well as several other
classes of nonimmigrants.

  Trainee Category Is Vulnerable to Misuse as Employment Program

The potential exists for the Trainee Program to be misused as an
employment program. Regulations strictly prohibit the use of the trainee
category for ordinary employment purposes, stating in particular that
sponsors may not place trainee participants in positions that are filled
or would be filled by full-time or part-time employees. State and the
overseas posts provided some information describing Trainee Program
abuses, but they did not have information on the extent of the problem.

o 	In one example, a sponsor learned that an organization it had
contracted with to help select and place trainees had placed the
participants with employers that had contracts to provide H-2B temporary
workers.14 The organization had participated in the Trainee Program
because the H-2B visa category was at its limit and it was looking for an
alternative way to receive foreign workers.

o 	In another example, a staffing agency recruited about 650 electrical
engineers, primarily from Slovakia, Bulgaria, and Romania, to come to the
United States as trainees. Ostensibly, the plan was to train the engineers
in the United States because they would be working on projects in Europe
that required knowledge of U.S. standards. However, the organization
served as an electrical contractor, placing the trainees on U.S.
construction projects as electricians. Because it was not designated to
sponsor trainees, the staffing agency approached a few designated sponsors
to issue the DS-2019 forms. State received complaints from the trainees
and the electrician's union and investigated this case. To correct the
situation, the sponsors and the union eventually found appropriate
placements for some of the engineers. Others returned to their countries.
According to a State

14An H-2B visa is a nonimmigrant visa issued to foreign nationals who are
temporarily coming to the United States to perform nonagricultural
services or labor, if an unemployed person capable of performing such work
cannot be found in the United States.

official, the staffing agency went out of business, and the principal
party was indicted on criminal charges.

The Acting Director of the Office of Exchange Coordination and Designation
described agricultural training programs as problematic because of the
potential for fraud. He said the abuses are not hidden and that there is
not even an attempt to represent jobs as training, and that employers
refer to the participants as employees rather than trainees. For example,
a 2004 DHS investigation involved four Chinese nationals brought to the
United States by an individual to participate in an agricultural program
sponsored by a Florida university. The trainees were placed with a dairy
farm that had an agreement with the university. DHS found that only one
trainee had a firm grasp of English, which called into question the
trainees' eligibility for a J-1 visa as well as whether the trainees were
receiving training or simply employed at the farm. Upon further
investigation DHS found that the individual had brought 17 trainees to the
United States to participate in the university's training program. The
trainees were placed at four participating dairies. DHS also found that
only one of the dairies reported having a structured training plan.
According to DHS, the university violated regulations concerning
sponsoring organizations for exchange trainees by failing to ensure that
the J-1 trainees were properly compensated and possessed the required
language ability to participate in an English language-based training
program. DHS further stated that the dairies were exploiting the J-1
trainees for cheap labor and in most cases were not concerned with
actually training them beyond what was necessary to perform their work.
The OIG's 2000 report also described abuse of the Trainee Program. In two
of the cases that the OIG investigated, U.S. workers complained that they
were replaced by trainees.

Despite such misuses, Labor officials stated that it is not likely that
the exchange programs will have any effect on the U.S labor market because
of the small number of J-1 exchange visitors (about 283,000 in fiscal year
2004) relative to the U.S. workforce.15 However, the U.S. government does
not collect data to assess any potential effect of exchange programs on
the U.S. labor market. Labor officials said that a monthly household
survey, the Current Population Survey, reviews a sample of households to
compile labor statistics on foreign-born workers. However, the numbers of
exchange program participants is so small that even if they were captured

15For example, the total civilian workforce in the United States was over
147 million as of September 2004.

by these surveys there is no way to separate out the effect of their labor
participation from that of the other foreign-born workers. Also, it is
possible that exchange participants would not be captured in the survey
because of their housing arrangements. For instance, if they do not reside
in traditional housing units and live in dormitories or resort-provided
housing, they may not be included in the survey sample.

  Some Exchange Participants Could Be Exploited or Have Otherwise Negative
  Experiences

The Summer Work Travel and Trainee participants generally have positive
experiences in the United States, according to the sponsors and
participants we met with. Some sponsors and overseas representatives
survey their participants on their experiences. One of the sponsors said
its research showed that about 85 percent of its participants were
satisfied with their placement. All of the Summer Work Travel and Trainee
participants whom we met with described their overall experiences as
positive.

When the participants do complain, the complaints are generally minor,
usually involving disappointments with their placement, housing, or
location. The Office of Exchange Coordination and Designation investigates
all complaints that are brought to its attention, according to State
officials. In addition, the regulations require the sponsors to inform
State of any serious problems or controversy that could be expected to
bring State or the sponsors' exchange programs into disrepute. However, we
found that although State may follow up on such reports, it does not
systematically document or analyze them. Such an analysis could be used to
identify program weaknesses. State acknowledged that is does not have
procedures for recording and maintaining all complaints in all categories
and stated such procedures are currently being prepared and will be
incorporated into the Foreign Affairs Manual.

Occasionally, the exchange participants have negative experiences as a
result of exploitation by a third party. A State official described an
incident in which about 45 current Summer Work Travel participants were
placed in substandard housing. Apparently, the housing was leased by an
employee of the sponsoring organization. The sponsor subsequently placed
the students in better housing, and the OIG is investigating the incident
at the Exchange Visitor Program office's request. State officials
described another situation in which they fear a third party might have
exploited the exchange participants. In this case, Bulgarian Summer Work
Travel participants were approached by an employee of the local program
representative while they were still in Bulgaria and told that the jobs
arranged for them in New Jersey

by the U.S. sponsor were no longer viable and that they were instead to
report to jobs in Florida. As a result, when the Bulgarians arrived in the
United States, they refused to continue on to New Jersey with the
sponsor's representative, who met them at the airport. Instead, they had
tickets to Florida and went there to work for a third-party organization
that provided cleaning services to hotels. State and DHS are currently
investigating this case.

When such situations receive negative media attention, it can further
undermine the purpose of the program. For example, a July 13, 2005,
article in a New Hampshire newspaper reported on the plight of three
students from Romania who arrived in the United States on July 5, 2005, to
find that the jobs they were promised no longer existed. News of these
situations may even reach the foreign media. For example, a June 2004
United Press International article concerning an incident affecting
Russian students stated the incident was also reported by the Moscow
Times. As a result of such situations at least one foreign government has
discussed its concerns with U.S. embassy officials in their country,
according to a Bureau of Consular Affairs official.

Conclusions	The Summer Worker Travel and Trainee Exchange Visitor Program
categories are important components of U.S. public diplomacy efforts.
However, State has not exercised sufficient management oversight of the
programs to ensure that they operate as intended and are not abused. State
has taken some action to address identified deficiencies, such as
beginning efforts to revise the regulations; but progress has been slow.
Also, State has been slow in establishing a compliance unit, which would
bolster oversight efforts, despite recommendations from State's OIG to do
so. GAO guidance on internal control standards instructs agencies to
identify risks that could impede the efficient and effective achievement
of program goals. Once these risks are identified, they should be analyzed
for possible effect. For example, an analysis of complaints and problems
that participants and sponsors report could uncover program weaknesses,
and these results could be used to guide the efforts of the compliance
unit. Assessing such risks is a necessary step to mitigating the risks.
But State has not taken action to assess the risks associated with the
Summer Work Travel and the Trainee programs, in part because limited data
are available.

  Recommendations for Executive Action

This report recommends that the Secretary of State take the following
three actions to enhance the overall management and monitoring of the
Summer Work Travel and the Trainee programs:

o 	fully implement a compliance unit to better monitor exchange program
activities and address deficiencies;

o  update and amend the regulations where necessary; and

o 	develop strategies to obtain data, such as information on overstays and
program abuses, to assess the risks associated with the program, and use
the results of its assessment to focus its management and monitoring
efforts.

  Agency Comments and Our Evaluation

State provided written comments on a draft of this report. These comments
are reprinted in appendix II. State and DHS also provided technical
comments, which we have incorporated into the report as appropriate.

In its comments, State acknowledged weaknesses in its oversight and
administration of the Exchange Visitor Program and reported that it has
designated program oversight and administration as a weakness under the
Federal Managers Financial Integrity Act. State described a number of
actions it is taking to implement each of our recommendations, including
developing a corrective action plan, establishing a compliance unit,
working to revise program regulations, and working with DHS to gather data
related to the tracking of overstays.

As we agreed with your office, unless you publicly announce the contents
of this report earlier, we plan no further distribution of it until 30
days from the date of this letter. We will then send copies of this report
to interested congressional committees, and the Secretaries of State, DHS,
and Labor. We will also make copies available to others upon request. In
addition, the report will be available at http://www.gao.gov.

If you or your staff have any questions about this report, please contact
me
at (202) 512-4128 or [email protected]. Contact points for our Offices of
Congressional Relations and Public Affairs may be found on the last page
of this report. GAO staff who made major contributions to this report are
listed in appendix III.

Sincerely yours,

Jess T. Ford
Director, International Affairs and Trade

Appendix I

Scope and Methodology

To examine how State manages the Summer Work Travel and the Trainee
programs to ensure that only authorized activities are carried out under
the programs, we

o 	reviewed previous GAO and OIG reports, program regulations and
guidance, cables, sponsors' annual reports, and other information
pertaining to the programs;

o 	reviewed program files maintained by the Bureau of Educational and
Cultural Affairs, Office of Exchange Coordination and Designation, for
selected Summer Work Travel and Trainee sponsors to gain an understanding
about the kinds of problems that the sponsors report to the Department of
State (State) and how State has addressed them;

o 	interviewed State officials, including the Bureau of Educational and
Cultural Affairs and the Bureau of Consular Affairs, and the Department of
Homeland Security (DHS) to discuss how the U.S. government manages the
programs;

o 	interviewed Department of Labor (Labor) officials about the impact of
the programs on the U.S. labor market, and the Social Security
Administration on issues related to Social Security cards for exchange
visitors; and

o 	met with nine sponsors of the Summer Work Travel Program that accounted
for 75 percent of the participants in 2004 and 13 sponsors of the Trainee
Program that accounted for 54 percent of the participants in 2004,1 as
well as an official of an association of exchange program sponsors to
discuss how sponsors carry out their monitoring and oversight
responsibilities.

We relied on data from DHS' Student and Exchange Visitor Information
System (SEVIS) to identify sponsors and the number of participants. The
SEVIS database is used by exchange program managers, sponsors, and U.S.
government agencies to keep track of individuals who enter the United
States on exchange visitor and student visas. We reviewed SEVIS data and
discussed its reliability with State and DHS officials and sponsors, based
on the descriptions of the database, procedures for entering and managing
the

1We visited 13 sponsors in all. Seven of the 13 managed both Summer Work
Travel and Trainee programs.

Appendix I Scope and Methodology

data, and the internal checks that are part of the system. We believe
these data are sufficiently reliable for our purposes. We relied on data
from the sponsors to identify their overseas representatives, exchange
participants, employers, and host companies.

We met with 28 exchange participants to discuss their views of the
programs. We reviewed data provided by the sponsors to identify exchange
participants who were in their programs during our fieldwork and who were
in nearby locations. We visited exchange participants in Boston,
Massachusetts; Bolton Valley and Smugglers' Notch, Vermont; and
Washington, D.C. We used the results of our interviews for illustrative
purposes and not to generalize to all participants.

We also visited three overseas posts--Minsk, Belarus; Warsaw, Poland; and
Dublin, Ireland--where we observed visa interviews of exchange program
applicants, reviewed post validation studies and other exchange program
guidance, and discussed the exchange programs with consular and embassy
officials. We also met with the local representatives of the U.S. sponsors
to discuss how they recruited and screened Summer Work Travel and Trainee
applicants. We selected Belarus because of consular concerns about
overstays and the integrity of the overseas partners. Belarus is also one
of the top sending countries for the Summer Work Travel Program. We
selected Poland because it was the number one sending country for Summer
Work Travel participants and within the top-10 sending posts for trainees
in 2004. We selected Ireland because it is also within the top-10 sending
countries for both the Summer Work Travel and the Trainee programs and
because of the decreased participation in the Summer Work Travel Program
after State's ruling concerning the eligibility of certain students. We
used the results of our fieldwork for illustrative purposes and not to
generalize to all posts.

To examine the potential risks of the programs we reviewed past GAO and
OIG reports, and examined post validation studies, cables, and other
documents. We followed up on information we obtained in Belarus on asylum
seekers with J-1 visas with (1) the Bureau of Consular Affairs' Office of
Consular Fraud Prevention; (2) DHS' Citizenship and Immigration Services,
Asylum Division; and (3) DHS' Fraud Detection National Security Unit. We
also requested data on overstays from the National Security Investigations
Division of DHS' Office of Investigation, U.S. Immigration and Customs
Enforcement. The overstay data that DHS provided were primarily obtained
from DHS' arrival and departure information system. Past GAO reports have
discussed the weaknesses in the U.S. government's

Appendix I Scope and Methodology

methods of collecting overstay data. However, despite the lack of
precision of both the DHS and post data on overstays, these data are
sufficiently reliable to indicate overstays are a cause for concern.

We conducted our review from November 2004 to August 2005 in accordance
with generally accepted government auditing standards.

                                  Appendix II

                     Comments from the Department of State

Appendix II
Comments from the Department of State

Appendix II
Comments from the Department of State

Appendix III

                     GAO Contacts and Staff Acknowledgments

                    GAO Contact Jess T. Ford (202) 512-4128

Staff Acknowledgment	In addition to the individual named above, John
Brummet, Assistant Director; Joseph Brown; Joseph Carney; Maria Oliver;
and La Verne Tharpes made key contributions to this report.

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