Immigrants say they feel scammed after their visas were not processed and they received no refund.
Michael Hemmerde applied for residence in 2019 but lost his job as a manager at Auckland's ASB Waterfront theatre in August.
The Chilean asked Immigration New Zealand (INZ) for a refund and was refused two months later.
"I had not even been given a case officer, nothing had happened to my file," he said. "When you apply for something and you don't get a service, you are expecting a refund of the work that wasn't ever done on your file. They take the money, they put you in the queue, nothing happens, they kept the money and I never got the service I paid for."
He's back home but still angry.
"To be super honest with you, I find what INZ does is a government-managed scam."
Qi Lishuang, from China, who worked in hospitality in the South Island for four years, asked INZ what work had been done since she applied for residence in December 2018.
"I've been waiting one-and-a-half years and then all of a sudden I got a case officer days after I submitted my refund request," she said. "They said 'oh, your documents have been transferred from one building to another building of the same branch in Mānukau - your money is in there now, you're unable to take it back.
"I just said, this is completely a robbery, but it's legal. Because you don't get to say, they get the final say: 'Sorry - no refunds'."
A partial refund for people who no longer fit the criteria after such a long delay - and the chaos that Covid had caused to jobs - would help them get on with their lives, she said.
She would use the money to help pay her retraining in early childhood education.
Immigration advisor Matt Simpson said the refusal to refund when little had been done on applications was a consumer affairs issue.
Government information he received showed little was done before they were sent to a queue for up to two years.
"It's been triaged at the [document] branch, and they've confirmed all the information is there, then it's been filed off to the branch to be ready to be allocated.
"There's been talk over the last 12 months about what's happened with all these allocations and if it's Immigration's fault or the government's fault. But the reality is they've just been sat there doing nothing."
Immigrants were also paying to renew work visas in the meantime, which he described as a money grab.
Included in the fee of between $2700 and $3300 is a levy of about $800 - and he said at least that should be refunded.
RNZ asked in an Official Information Act request for the number of people who had requested refunds, but was told that would mean manually examining each person's file.
Almost 3000 people had received refunds in the 12 months to September, more than in the three previous years combined, and totalling nearly $1.4 million.
INZ said it worked on a cost-recovery basis and refunds were only given in special circumstances.