Illegal Immigration activity

Someone filed a I-130 petioning for his wife. It just so happens that the statements and documents presented were false, the so called wife is actually his cousin and the marriage certificate is false, they paid someone abroad for the false document. The cousin never came because he didn't follow through with some missing documents to the NVC and it has now been a year for which the petition has been withdrawn. He now has someone who is paying him a lot of money to petition for her. Can he place this petition, can this be approved? Can I report this illegal activity and where? Will INS consider this a felony and stop him from attemting to bring yet another illegal to the states?