Inclination of students from the Indian sub-continent (or lets say from South Asia) is more or less the same. Students have post study work/settlement as a goal and preference for an education destination is “whether we like it or not” influenced significantly by the pathway to work/settlement following the program of study. Not illegal at all. If a country offers the pathway, it is the sought after destination. Plain and simple.
However, there is one more influence on the student numbers (which is the focus of this blog) and this is the “loophole driven ease” with student visa. We have seen in the recent past that countries such as NZ benefitted when it allowed education providers to determine their own the English language proficiency test requirement and when it mandated a test, the numbers fell especially in the PTE sector. Just last year, Immigration NZ tightened another aspect of its regulation where it started emphasising on the accessibility and availability of the demonstrated funds during the study in NZ. It detected(and publicly released) that there were large number of students primarily from certain regions of India who had evidenced their financial ability through an education loan sanction letter which was either never utilised or was fake in itself. Immigration NZ took an extreme move to go through the lodged visa applications of even the students who had secured the visa and were in NZ and then deeming any genuine but utilised(disbursed) loan as violative of the visa condition and even made effort to deport such students. The student visa numbers have plummeted from India ever since, even though the “trumped” world offered NZ an opportunity to make inroads.
The point that I am making is that sudden spurt in student numbers is often a result of a loophole in the student visa system. This is more noticeable when other countries that are similar and from the same region have a different trend. The unusual spurt in numbers is the first alarm for the authorities to take corrective action and protect the industry including protecting the efforts being put in by genuine agencies of education providers.
The comparison of recent student visa applications from India with that from Nepal indicate that the two countries have have had totally different trends and my study of the reasons highlight one emerging fraud loophole.
- Indian market for Australia has plateaued. The total number of student visa applications from India during 2016-17 was roughly the same as in 2015-16 (31021 compared to 30726). The growth in student visa numbers is solely due to a higher visa grant rate. However when we look at the student visa applications from Nepal for the same period, the numbers have almost doubled. Yes doubled from 9334 applications to 18218 applications. The granted visas too has jumped from 7759 to 14398 with a growth of 86%.
- Indian market for Australian vocational sector experienced a decline of close to 50% during the 2016-17 over 2015-16 while during the same period it increased by over 50% for Nepal.
So what is so unusual for Nepal that the market has grown so sharply while it has plateaued for India in the last 1-2 years? The immigration requirements for work or settlement has only tightened during the same period with changes to work permits and removal of several occupations from SOL.
- The answer, my friend, is known to all.
Over the last 1-2 years, Australian Government lowered its guard and has encouraged the trend. It is possibility that in the bid to have a world-wide policy and movement towards the online process, country specific restrictions were changed and this led to the advantage of those who wanted to abuse the system. Only because of fraud and complicity of certain banks, the same department only accepted funds demonstrated from two Nepalese banks for years. Reputed agencies and agent associations had lobbied tirelessly for expansion of the acceptable financial institutions to 7-8 from the 2 but that had not been considered despite assurances. Then suddenly in the last year, the mindset of policy makers changed and they realised that they had no business in identifying or recognising certain banks over others in a foreign land and thus came up with the universal worldwide policy of accepting all scheduled banks that are recognised by the national bank of that country. This meant that for Nepal, suddenly and without any consultation with any stake holders, the list of acceptable banks was increased from 2 to all 28 Banks. Yes, this happened.
- The common online visa process, led to another loophole emerge. The student visa requirement is for the student “being able to demonstrate if asked” that they have one year funds with them. Nepal having been allotted a lower assessment level meant that technically for most institutions, the evidence of funds was not even required to be provided with the visa application but only provided “if asked”. This was a significant change from the practice earlier when the student visa applications was filed into the Australian High Commission in New Delhi and had all the attached bank statements. For years, I have sat through bi-annual briefings to institutions and agents by the same very department on Nepal where the presentation detailed high degree of fraud and the need for greater check. Thus, this policy change in Canberra, not just baffled me but almost all others in the industry. It was also a contrast to what applied in rest of the sub-continent.
Now let me share the current anatomy of fraud that in my opinion is the biggest reason for the sharp increase in visa applications to Australia. There are certain agencies complicit in this but that is not what I am focussing on here and it is for the department to identify them.
- The current student visa process requires institutions to assure themselves that the student has one year living and tuition fees. For this, institutions (and visa office at times) want the student to demonstrate that the funds are held in an acceptable bank (read it as one of the 28 banks).
- However there is no requirement that the funds have to be held in these banks for any set period of time and can thus be a recent deposit. Wherever there is a recent deposit, a source of that recent deposit may need to be provided “if asked”.
All good till now and makes sense.
- Now to the fraud and how that takes place: The recent deposit in the acceptable bank is genuine funds. Mostly. However the funds often don’t belong to the student at all. To assure the education provider or the visa office that the recent large deposit is of the student, It is shown to have come from a cooperative bank account of the family and a “cooperative bank statement” is evidenced to the education provider as “source of the large deposit”. It is a known fact that the cooperative bank statements are not verifiable and very easy to cook. Cooperative banks don’t have cheque books or online statements and anyone can “for a small money” get any statement issued.
- Yes, very easy to cook. Let me now share a few such cooked cooperative bank statements that we organised within days and in the name of individuals linked to the International education industry (including one in the name of the International manager at the Australian Universities). The purpose of organising the fakes was to prove to the institutions that the document that they had been accepting was so almost always fake. Following our sharing this, few Universities have stopped accepting such documents.
The sad truth is that this methodology of fraud is known to several education providers but they seem to accept the cooperative sourced (or demonstrated) funds held in an acceptable bank only because the Department of Immigration and Border Protection has a policy that doesn’t require it to be checked. Even the recent Agent Digest 6 September 2017 which went into details on emerging fraud and the need to verify the source of funds has no specific mention of the “cooperative sourced funds”. One may say that it is implied though.
I am certain that the department will look closely on these huge recent funds that get shown up in the acceptable bank. But how will it, when the online lodgement and the policy allows recent funds. If the immigration was to attempt verification then it would delay the process and lead to complaints. Then the department must consider that the policy does want funds to be available and accessible in Australia and such funds that are almost always not of the family but raised from the market for the purpose of the student visa will never be accessible and available in Australia during the study period. Only way forward will be to understand that there is a high likelihood of such funds being non-genuine and non-verifiable and thus simply not accept the recent deposits where the submitted paper trail leads it to a cooperative bank account.
And as I stated, certain officially contracted agencies are complicit by way of assisting students with such arrangements and anonymous phone calls to their offices can confirm that some of them even have a set fee to provide such assistance. Like always, a few bad apples spoil the whole lot. Time to get rid of them. Unless education providers stop chasing numbers for the greed by giving the reason that “the immigration allows and thus it is fine”, they too will get looped in when the loophole is plugged. There are certainly not as many genuine students in the market to lead to a doubling in nun bets and the market may experience a huge fall. Not too far in future