VFS Global

VFS Global is a visa and passport administration outsourcing company for governments and diplomatic missions. Zubin Karkaria founded the company in 2001 while he was chief executive at Kuoni Travel. Formerly based in India, the company is now headquartered in Dubai with offices in 147 countries. In 2018, VFS processed approximately 25 million visa applications, often containing passport details and financial histories, on behalf of the British Home Office and 61 other governments.

During the past two decades of its operations, VFS Global has attracted considerable controversy as well as criticism from governments, journalists, and clients. It has been criticized for allegedly exploitative and monopolistic practices, lack of transparency, and numerous data security failures. Many visa applicants from lower-income countries reported that they "missed flights and were wrongly denied visas due to delays and administrative errors, including apparent failure to scan vital documents."

History

Origins and revenue model

Founder Zubin Karkaria conceived the idea for VFS Global while working with the Kuoni Group. Karkaria believed one could circumvent embassy's wait times required for processing visa applications by outsourcing the administrative work. He soon "persuaded the US government to pilot a scheme for Indian visa applicants to the US at its Mumbai embassy". The company opened its first visa processing centre in Mumbai that same year. In 2003, the company acquired a UK Government contract to process visa applications from India.

By 2007, the company had obtained its first global account from UK Visas and Immigration for operations across 33 countries. Within one year of gaining its account, the company's image was tarnished by a data breach which exposed the sensitive information of UK visa applicants. Despite recurrent data breaches, the company later obtained a major contract with the United Kingdom to administer the majority of the UK's visa applications. The contract was a significant change in how visa applicants to the United Kingdom were charged to have their applications processed.

The company's growth was primarily due to its revenues from service fees paid directly by visa applicants. In 2009, financial records indicated that VFS Global's parent company at the time, VF Worldwide Holdings, was an offshore corporation in Mauritius, an African tax haven.

Expansion and growth

In August 2017, the VFS Global acquired the UK-based visa service provider TT Services (TTS) for an undisclosed amount. At the time of the acquisition, TTS operated 51 visa application centres in over 35 countries with 216 employees. Later that year, in November, VFS Global expanded its visa services in Cyprus with new centres launched in the additional cities of Thiruvananthapuram, Goa, Gurugram, and Jaipur.

In January 2019, the parent company of VFS Global, EQT AB, declared their intention to sell the company. In August 2019, an in-depth financial investigation by the British newspaper ''The Independent'' revealed that VFS Global had experienced exponential growth in recent years and its shareholders extracted £567m through "distribution to owner" payments and inter-company loan write-offs. This growth has been attributed to the company's "exploitative" business practices.

In October 2021, Blackstone acquired a majority stake in VFS Global. Kuoni and Hugentobler Foundation remains a minority stakeholder. Prior to October 2021, the company was owned by a private equity fund and, as VF Worldwide Holdings, is incorporated in the African tax haven of Mauritius. Investors in the company include the Chinese and Emiratis investment authorities, the Ohio Police & Fire Pension Fund, and Theo Müller.

Criticism and controversies

Throughout its existence during the past two decades, VFS Global has attracted considerable criticism from governments, investigative journalists, and its clients. The company allegedly pressured visa applicants into purchasing premium services such as premium lounges. In 2019, the British Home Office was deluged by complaints from customers applying for visas using VFS Global, many of whom accused the company of "exploiting vulnerable applicants for profit." The majority of these applicants were from lower-income countries, and they "missed flights and were wrongly denied visas due to delays and administrative errors, including apparent failure to scan vital documents."

Data breaches

Initial breach and inaction

Between 2005 and 2007, a security flaw in the VFS Global application website for the British Foreign & Commonwealth Office resulted in many visa applications from India, Nigeria and Russia being publicly accessible. Sensitive data stored in VFS's online service could be accessed by simply altering the VFS website's URL address. By doing so, anyone could access the company's visa applicant database including their "stored passport numbers, names, addresses, and travel details." Although the security flaw had been known since December 2005, VFS Global addressed the issue only after media reports in May 2007.

UK government investigation

Following this data breach and media outcry, the UK Secretary of State for Foreign and Commonwealth Affairs appointed an independent investigator to uncover the reasons for the breach of security in the VFS online visa application website. The subsequent July 2007 report highlighted many failures by VFS, including that VFS had failed to protect personal data to the levels expected by the UK Data Protection Act. The report recommended that the VFS online visa applications not be resumed for applications from India.

In November 2007, the UK Information Commissioner's Office announced that it had found the Foreign Office's contractual relationship with VFS Global to be in breach of its obligations under the Data Protection Act 1998. The Information Commissioner's Office required the Foreign Office to sign a statement that it would comply with the Data Protection Act and would not reopen the VFS UK visa online facility. As a result of this ruling, the Foreign Office reviewed its relationship with VFS and briefly sought to significantly reduce its outsourced work, especially in the area of IT.

Following this incident, several governments criticized VFS Global's abilities and porous security protocols. "There's the accountability issue, the privacy issue and why are we outsourcing to a for-profit entity something that belongs in the security mandate?" asked Victor Wong, executive director of the Chinese Canadian National Council. Likewise, Liam Clifford, an immigration expert working for ''Global Visas'', raised security concerns associated with VFS Global's operations: "Once you put this work in the hands of private companies overseas, you no longer have the same protection."

2015 data breaches

VFS Global's data security again came under scrutiny in July 2015 when its online visa forms for Italy allowed any user to access the personal information of other applicants—including their date of birth, passport details and addresses—if they input the ID number of another person when logging into the system.

Monopoly allegations

VFS Global has been alleged to be a monopolistic enterprise operating in the visa outsourcing sector. Its alleged monopoly has led to issues related to prohibitive visa application prices and also sparked concerns in the areas of centralised document handling and content security.

In June 2014, the South African Competition Commission investigated the company regarding allegations of market dominance in the visa support services market to foreign embassies. The Commission recommended further investigations into the company. In a statement to European Union parliament in July 2018, VFS Global denied that their company operates as a monopoly, though its prepared statement did not cite any outsourcing companies with whom they are in competition for winning contracts.

Extortion allegations

In 2019, the Nigerian government's Portfolio Committee on Home Affairs accused VFS Global of "extorting" and "mistreating" vulnerable visa applicants in developing countries such as Nigeria. Additionally, the government placed the company under investigation for "allegations of abusive market dominance and unlawful tender procedures, resulting in excessive visa application prices and hidden fees."

English-only service in Canada

In March 2023, VFS Global faced criticism for requiring a French-speaking applicant for permanent residency in Canada to respond only in English, despite that it is legally obligated to provide services in both official languages of Canada. Quebec's Minister Jean-François Roberge called it "completely unacceptable" and "all citizens should be able to interact with the federal government in their language of choice". VFS Global did not apologize for the incident.

See also

* BLS International

References

Citations

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{{DEFAULTSORT:VFS Global
Outsourcing companies
Companies established in 2001
Indian companies established in 2001
Companies based in Dubai
Trade monopolies