This entire scam can be done entirely legally by subcontracting the work to your foreign friend, if your clients allow for that; if the end result is of decent enough quality then I don't see why they wouldn't. You'd be on the hook if they mess up, but the same is true when you lie to your friend's employers.

However, these people choose not to go the legal route, instead relying on lies and fraud. They go as far as to hire others to do part of their lying just to get into a company.

Personally, I'd call the authorities the moment I'd find out an employee of mine has been lying about their qualifications and experience from the very first day to fake it through the interview. You cannot trust someone whose entire career is built on top of lies, or someone who actively enables such behaviour.

I'm not sure if these people are a small step up from the call center scammers because at least they deliver something or a small step down because they're supposedly capable enough to do better. I'm sympathetic to the third world programmers that have the capabilities to earn some of the absolutely insane wages American programmers get paid, but I completely oppose the large-scale fraud these lying-as-a-service middlemen employ to make money.