A California lawyer who specializes in reproductive law pleaded guilty Tuesday for her role in what federal prosecutors called a "baby-selling ring" that charged a dozen couples more than $100,000 to adopt babies born from surrogate pregnancies.
Theresa Erickson, 43, of Poway pleaded guilty to conspiracy to commit wire fraud before U.S. Magistrate Judge William McCurine.
According to her plea agreement, Erickson along with a Maryland-based lawyer who also specializes in reproductive law and a Las Vegas woman, recruited women to travel to the Ukraine to be implanted with embryos created from the sperm and egg of donors.
Once a gestational carrier, or surrogate, reaches the second trimester of pregnancy, prosecutors claimed the defendants would "shop" the babies by falsely telling couples that a couple who had intended to adopt the baby backed out of the deal.
The new couple that agreed to adopt the baby would have to pay more than $100,000 in fees. Women who agreed to carry the babies to term were paid from $38,000 to $45,000, court documents said.
While most of the surrogates and adoptive parents lived outside of California, prosecutors said the defendants broke state law by falsely declaring with the San Diego Superior Court that the unborn baby was part of an agreement made between the surrogate and the couple before pregnancy.
The law is designed to prevent the sale of parental rights to children, but by falsely declaring the unborn baby was the result of a legitimate surrogacy arrangement they obtained pre-birth judgments that named the adoptive parents on the babies' birth certificates.
The surrogates were sent to Ukraine to have the embryos implanted because no American fertility doctor would perform such a procedure without documents proving that an agreement existed between the woman and the "intended parents," Assistant U.S. Attorney Jason A. Forge told the Los Angeles Times.
Additionally, prosecutors alleged the defendants misrepresented the identities of the sperm and egg donors and fraudulently obtained more than $20,000 in state insurance coverage for the surrogates, who were ineligible to receive the benefits.
The FBI investigated the scheme after receiving complaints from gestational carriers and others, said Special Agent Darrell Foxworth, an FBI spokesman in San Diego.
The couples who adopted the babies did not believe they were breaking the law and will not have their parental rights taken away, Forge said.
Erickson, who prosecutors believe profited about $70,000 through the scheme, will pay each of the 12 couples $10,000 in restitution and up to $250,000 in fines to the government. She faces up to five years in prison when she is sentenced Oct. 28.
An after hour call to Erickson's attorney, Ezekiel Cortez, was not immediately returned.
Hilary Neiman, the Maryland attorney, pleaded guilty to conspiracy to commit wire fraud on July 28. Carla Chambers, who is identified in court papers as a surrogate on multiple occasions and helped recruited women to be gestational carriers, pleaded guilty last week to conspiracy to engage in monetary transactions derived from unlawful activity.
Court documents detail email exchanges in which Neiman and Chambers discussed inquiries from a prospective couple who wanted to know if they and their close friends could each parent a set of twins.
"Firstly, I am not opposed to it, however it does not give me the warm fuzzies," Chambers replied. "My second thoughts would be, what if something goes wrong and one twin dies, there would need to be guidelines about what happens. I would of course to prefer to place together! But would be open to it."
Neiman and Chambers face the same penalties as Erickson when they are sentenced Oct. 14 and Oct. 28, respectively.