News Maternity and Birthing

Exposure of Surrogacy and Baby-Selling Scheme Underscores Need for Accountability

Marcy Darnovsky

Two prominent reproductive law attorneys now await sentencing by a US district court after pleading guilty to charges connected with an elaborate surrogacy and baby-selling scheme. What measures will be taken by the fertility industry, policy makers, women’s health advocates and others to ensure the well-being of everyone involved with assisted reproduction practices?

Errata from the author: Thanks to Mark Demeray, President of the American Academy of Adoption Attorneys and Judith Sperling-Newton, Director of the American Academy of Assisted Reproductive Technology Attorneys for informing me that neither Theresa Erickson nor Hilary Neiman are, or have ever been, Fellows of their organizations. I regret having relied on a source that was in error.

Two prominent reproductive law attorneys, Theresa Erickson and Hilary Neiman, now await sentencing by a US district court after pleading guilty to charges connected with an elaborate surrogacy and baby-selling scheme.

The many headlines about this latest fertility industry scandal are clear on the nature of the criminal activities. NBC San Diego titled its early story “Lawyer Busted in Black-Market Baby Ring”; the Los Angeles Times called it a “scam”; the UK Telegraph ran with “Babies ‘sold for $150,000’ in California.” Even the FBI pulled no punches: Its press release is titled “Baby-Selling Ring Busted.”

The most complete account yet to appear in the mainstream media, by Julie Watson of Associated Press, appeared in dozens of outlets under the headline “Surrogacy Scandal Raises Question About Regulation.” The episode is also being closely examined discussed by several bloggers (1, 2, 3), one of whom posted Erickson’s plea agreement.

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Erickson and Neiman are far from minor players in the fertility industry. According to adoption advocate Pat Irwin Johnston, they were members of the American Society of Reproductive Medicine and several of its committees, and of the invitation-only American Academy of Adoption Attorneys and American Academy of Assisted Reproductive Technology Attorneys. Erickson appeared frequently in the media and sat on the boards of several surrogacy consumer groups.

The baby-selling scheme that Erickson, Neiman, and a third woman named Carla Chambers put together spanned several states and two continents, and trampled on the minimal surrogacy regulations of California, where Erickson is based and where the surrogates were required to deliver the babies. While many countries and a number of states prohibit commercial surrogacy, California permits it; in fact, the state is known around the world as “surrogacy-friendly,” meaning that the rights of commissioning parents are robustly protected. For example, surrogacy lawyers routinely get “pre-birth orders” from California courts that exempt commissioning parents from the procedures that are part of adoption, and put their names rather than the surrogate’s on the baby’s birth certificate. California does require that a surrogacy contract be in place before a surrogate is impregnated and before a pre-birth order is issued, provisions designed precisely to prevent baby-selling.

But Erickson and Neiman didn’t let that stop them. Relying on their reputations as credentialed and internationally-renowned members of the fertility industry, they recruited surrogates from across the US and sent them off to fertility doctors in the Ukraine, who were either unaware of or unconcerned about the absence of contracts and identified intended parents. The surrogates, who say they were duped into thinking that everything was legitimate, were impregnated with embryos made from anonymously-provided eggs and sperm.

The baby entrepreneurs waited until the pregnancies were in their second trimester, past the greatest danger of miscarriage, and then advertised for people willing to pay up to $150,000 — significantly higher than the going rate for legal commercial surrogacy — for a baby that they could claim soon. In other words, as the FBI press release put it, they “create[d] an inventory of unborn babies that they would sell for over $100,000 each.”

Erickson began the baby-selling scam in 2005; it ended only because of the FBI investigation that exposed it. Here’s an excerpt from an ad that Neiman placed on an online adoption forum in 2009:

Caucasian Infant, as embryos used where [sic] caucasian, however gestational carrier is of colour. Carrier is in Nebraska however birth will occur in California! … names of new parents names [sic] will be put on the birth certificate, no adoption neccesary, [sic] no homestudy needed! The minute the baby is born, parents will have 100% custody!

The trio told interested parties that the babies were available because another set of parents had backed out of a surrogacy arrangement at the last minute. To sweeten the deal, they could specify the baby’s sex, since that’s easy to determine in the second trimester.

So the two prominent fertility law experts lied both to surrogates and to prospective parents, and perhaps to the Ukrainian fertility doctors and gamete providers. The legal case against them, though, centers on the lies they told California courts and public agencies. According to the FBI press release, Erickson “fraudulently submitted false declarations and pleadings to the California Superior Court in San Diego, in order to obtain pre-birth judgments establishing parental rights for Intended Parents.”

And she topped up the profits by defrauding California’s program for uninsured pregnant women. As the FBI put it, she “caused applications containing materially false representations to be submitted to the State of California’s Access for Infants and Mothers program to subsidize the medical expenses for delivering the babies.”

Not surprisingly, the surrogacy field has been rocked by the scandal. A few players are acknowledging that rules of the road are needed. Circle Surrogacy founder and president John Weltman, for example, writes:

We need to establish … standards as a profession, have a licensing and review board to monitor practitioners and censor, suspend or revoke those who do not stay within those established guidelines.

But as Diane Allen of Canada’s Infertility Network points out, there have so far been no statements at all from the fertility industry’s professional organization, the American Society for Reproductive Medicine, or from infertility groups that are typically sanguine about surrogacy, such as Resolve, the American Fertility Association, and the International Council on Infertility Information Dissemination. Many questions about the baby-selling scandal remain unanswered. How did the perpetrators get away with it for years, when many others in the field must have known about or at least suspected what they were doing? What sentences will the court impose in October, and what will Erickson and Neiman do afterward? What will be the effects on the babies who were conceived from anonymous gamete providers in order to be sold, and on their families? And perhaps most importantly, what measures will be taken by the fertility industry, policy makers, women’s health advocates and others to ensure the well-being of everyone involved with assisted reproduction practices? We, and hopefully many others, will be closely following the unfolding events.

Analysis Economic Justice

New Pennsylvania Bill Is Just One Step Toward Helping Survivors of Economic Abuse

Annamarya Scaccia

The legislation would allow victims of domestic violence, sexual assault, and stalking to terminate their lease early or request locks be changed if they have "a reasonable fear" that they will continue to be harmed while living in their unit.

Domestic violence survivors often face a number of barriers that prevent them from leaving abusive situations. But a new bill awaiting action in the Pennsylvania legislature would let survivors in the state break their rental lease without financial repercussions—potentially allowing them to avoid penalties to their credit and rental history that could make getting back on their feet more challenging. Still, the bill is just one of several policy improvements necessary to help survivors escape abusive situations.

Right now in Pennsylvania, landlords can take action against survivors who break their lease as a means of escape. That could mean a lien against the survivor or an eviction on their credit report. The legislation, HB 1051, introduced by Rep. Madeleine Dean (D-Montgomery County), would allow victims of domestic violence, sexual assault, and stalking to terminate their lease early or request locks be changed if they have “a reasonable fear” that they will continue to be harmed while living in their unit. The bipartisan bill, which would amend the state’s Landlord and Tenant Act, requires survivors to give at least 30 days’ notice of their intent to be released from the lease.

Research shows survivors often return to or delay leaving abusive relationships because they either can’t afford to live independently or have little to no access to financial resources. In fact, a significant portion of homeless women have cited domestic violence as the leading cause of homelessness.

“As a society, we get mad at survivors when they don’t leave,” Kim Pentico, economic justice program director of the National Network to End Domestic Violence (NNEDV), told Rewire. “You know what, her name’s on this lease … That’s going to impact her ability to get and stay safe elsewhere.”

“This is one less thing that’s going to follow her in a negative way,” she added.

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Pennsylvania landlords have raised concerns about the law over liability and rights of other tenants, said Ellen Kramer, deputy director of program services at the Pennsylvania Coalition Against Domestic Violence, which submitted a letter in support of the bill to the state House of Representatives. Lawmakers have considered amendments to the bill—like requiring “proof of abuse” from the courts or a victim’s advocate—that would heed landlord demands while still attempting to protect survivors.

But when you ask a survivor to go to the police or hospital to obtain proof of abuse, “it may put her in a more dangerous position,” Kramer told Rewire, noting that concessions that benefit landlords shift the bill from being victim-centered.

“It’s a delicate balancing act,” she said.

The Urban Affairs Committee voted HB 1051 out of committee on May 17. The legislation was laid on the table on June 23, but has yet to come up for a floor vote. Whether the bill will move forward is uncertain, but proponents say that they have support at the highest levels of government in Pennsylvania.

“We have a strong advocate in Governor Wolf,” Kramer told Rewire.

Financial Abuse in Its Many Forms

Economic violence is a significant characteristic of domestic violence, advocates say. An abuser will often control finances in the home, forcing their victim to hand over their paycheck and not allow them access to bank accounts, credit cards, and other pecuniary resources. Many abusers will also forbid their partner from going to school or having a job. If the victim does work or is a student, the abuser may then harass them on campus or at their place of employment until they withdraw or quit—if they’re not fired.

Abusers may also rack up debt, ruin their partner’s credit score, and cancel lines of credit and insurance policies in order to exact power and control over their victim. Most offenders will also take money or property away from their partner without permission.

“Financial abuse is so multifaceted,” Pentico told Rewire.

Pentico relayed the story of one survivor whose abuser smashed her cell phone because it would put her in financial dire straits. As Pentico told it, the abuser stole her mobile phone, which was under a two-year contract, and broke it knowing that the victim could not afford a new handset. The survivor was then left with a choice of paying for a bill on a phone she could no longer use or not paying the bill at all and being turned into collections, which would jeopardize her ability to rent her own apartment or switch to a new carrier. “Things she can’t do because he smashed her smartphone,” Pentico said.

“Now the general public [could] see that as, ‘It’s a phone, get over it,'” she told Rewire. “Smashing that phone in a two-year contract has such ripple effects on her financial world and on her ability to get and stay safe.”

In fact, members of the public who have not experienced domestic abuse may overlook financial abuse or minimize it. A 2009 national poll from the Allstate Foundation—the philanthropic arm of the Illinois-based insurance company—revealed that nearly 70 percent of Americans do not associate financial abuse with domestic violence, even though it’s an all-too-common tactic among abusers: Economic violence happens in 98 percent of abusive relationships, according to the NNEDV.

Why people fail to make this connection can be attributed, in part, to the lack of legal remedy for financial abuse, said Carol Tracy, executive director of the Women’s Law Project, a public interest law center in Pennsylvania. A survivor can press criminal charges or seek a civil protection order when there’s physical abuse, but the country’s legal justice system has no equivalent for economic or emotional violence, whether the victim is married to their abuser or not, she said.

Some advocates, in lieu of recourse through the courts, have teamed up with foundations to give survivors individual tools to use in economically abusive situations. In 2005, the NNEDV partnered with the Allstate Foundation to develop a curriculum that would teach survivors about financial abuse and financial safety. Through the program, survivors are taught about financial safety planning including individual development accounts, IRA, microlending credit repair, and credit building services.

State coalitions can receive grant funding to develop or improve economic justice programs for survivors, as well as conduct economic empowerment and curriculum trainings with local domestic violence groups. In 2013—the most recent year for which data is available—the foundation awarded $1 million to state domestic violence coalitions in grants that ranged from $50,000 to $100,000 to help support their economic justice work.

So far, according to Pentico, the curriculum has performed “really great” among domestic violence coalitions and its clients. Survivors say they are better informed about economic justice and feel more empowered about their own skills and abilities, which has allowed them to make sounder financial decisions.

This, in turn, has allowed them to escape abuse and stay safe, she said.

“We for a long time chose to see money and finances as sort of this frivolous piece of the safety puzzle,” Pentico told Rewire. “It really is, for many, the piece of the puzzle.”

Public Policy as a Means of Economic Justice

Still, advocates say that public policy, particularly disparate workplace conditions, plays an enormous role in furthering financial abuse. The populations who are more likely to be victims of domestic violence—women, especially trans women and those of color—are also the groups more likely to be underemployed or unemployed. A 2015 LGBT Health & Human Services Network survey, for example, found that 28 percent of working-age transgender women were unemployed and out of school.

“That’s where [economic abuse] gets complicated,” Tracy told Rewire. “Some of it is the fault of the abuser, and some of it is the public policy failures that just don’t value women’s participation in the workforce.”

Victims working low-wage jobs often cannot save enough to leave an abusive situation, advocates say. What they do make goes toward paying bills, basic living needs, and their share of housing expenses—plus child-care costs if they have kids. In the end, they’re not left with much to live on—that is, if their abuser hasn’t taken away access to their own earnings.

“The ability to plan your future, the ability to get away from [abuse], that takes financial resources,” Tracy told Rewire. “It’s just so much harder when you don’t have them and when you’re frightened, and you’re frightened for yourself and your kids.”

Public labor policy can also inhibit a survivor’s ability to escape. This year, five states, Washington, D.C., and 24 jurisdictions will have passed or enacted paid sick leave legislation, according to A Better Balance, a family and work legal center in New York City. As of April, only one of those states—California—also passed a state paid family leave insurance law, which guarantees employees receive pay while on leave due to pregnancy, disability, or serious health issues. (New Jersey, Rhode Island, Washington, and New York have passed similar laws.) Without access to paid leave, Tracy said, survivors often cannot “exercise one’s rights” to file a civil protection order, attend court hearings, or access housing services or any other resource needed to escape violence.

Furthermore, only a handful of state laws protect workers from discrimination based on sex, sexual orientation, gender identity, and pregnancy or familial status (North Carolina, on the other hand, recently passed a draconian state law that permits wide-sweeping bias in public and the workplace). There is no specific federal law that protects LGBTQ workers, but the U.S. Employment Opportunity Commission has clarified that the Civil Rights Act of 1964 does prohibit discrimination based on gender identity and sexual orientation.

Still, that doesn’t necessarily translate into practice. For example, the National Center for Transgender Equality found that 26 percent of transgender people were let go or fired because of anti-trans bias, while 50 percent of transgender workers reported on-the-job harassment. Research shows transgender people are at a higher risk of being fired because of their trans identity, which would make it harder for them to leave an abusive relationship.

“When issues like that intersect with domestic violence, it’s devastating,” Tracy told Rewire. “Frequently it makes it harder, if not impossible, for [victims] to leave battering situations.”

For many survivors, their freedom from abuse also depends on access to public benefits. Programs like Temporary Assistance for Needy Families (TANF), Supplemental Nutrition Assistance Program (SNAP), the child and dependent care credit, and earned income tax credit give low-income survivors access to the money and resources needed to be on stable economic ground. One example: According to the Center on Budget and Policy Priorities, where a family of three has one full-time nonsalary worker earning $10 an hour, SNAP can increase their take-home income by up to 20 percent.

These programs are “hugely important” in helping lift survivors and their families out of poverty and offset the financial inequality they face, Pentico said.

“When we can put cash in their pocket, then they may have the ability to then put a deposit someplace or to buy a bus ticket to get to family,” she told Rewire.

But these programs are under constant attack by conservative lawmakers. In March, the House Republicans approved a 2017 budget plan that would all but gut SNAP by more than $150 million over the next ten years. (Steep cuts already imposed on the food assistance program have led to as many as one million unemployed adults losing their benefits over the course of this year.) The House GOP budget would also strip nearly $500 billion from other social safety net programs including TANF, child-care assistance, and the earned income tax credit.

By slashing spending and imposing severe restrictions on public benefits, politicians are guaranteeing domestic violence survivors will remain stuck in a cycle of poverty, advocates say. They will stay tethered to their abuser because they will be unable to have enough money to live independently.

“When women leave in the middle of the night with the clothes on their back, kids tucked under their arms, come into shelter, and have no access to finances or resources, I can almost guarantee you she’s going to return,” Pentico told Rewire. “She has to return because she can’t afford not to.”

By contrast, advocates say that improving a survivor’s economic security largely depends on a state’s willingness to remedy what they see as public policy failures. Raising the minimum wage, mandating equal pay, enacting paid leave laws, and prohibiting employment discrimination—laws that benefit the entire working class—will make it much less likely that a survivor will have to choose between homelessness and abuse.

States can also pass proactive policies like the bill proposed in Pennsylvania, to make it easier for survivors to leave abusive situations in the first place. Last year, California enacted a law that similarly allows abuse survivors to terminate their lease without getting a restraining order or filing a police report permanent. Virginia also put in place an early lease-termination law for domestic violence survivors in 2013.

A “more equitable distribution of wealth is what we need, what we’re talking about,” Tracy told Rewire.

As Pentico put it, “When we can give [a survivor] access to finances that help her get and stay safe for longer, her ability to protect herself and her children significantly increases.”

News Abortion

Study: United States a ‘Stark Outlier’ in Countries With Legal Abortion, Thanks to Hyde Amendment

Nicole Knight Shine

The study's lead author said the United States' public-funding restriction makes it a "stark outlier among countries where abortion is legal—especially among high-income nations."

The vast majority of countries pay for abortion care, making the United States a global outlier and putting it on par with the former Soviet republic of Kyrgyzstan and a handful of Balkan States, a new study in the journal Contraception finds.

A team of researchers conducted two rounds of surveys between 2011 and 2014 in 80 countries where abortion care is legal. They found that 59 countries, or 74 percent of those surveyed, either fully or partially cover terminations using public funding. The United States was one of only ten countries that limits federal funding for abortion care to exceptional cases, such as rape, incest, or life endangerment.

Among the 40 “high-income” countries included in the survey, 31 provided full or partial funding for abortion care—something the United States does not do.

Dr. Daniel Grossman, lead author and director of Advancing New Standards in Reproductive Health (ANSIRH) at the University of California (UC) San Francisco, said in a statement announcing the findings that this country’s public-funding restriction makes it a “stark outlier among countries where abortion is legal—especially among high-income nations.”

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The researchers call on policymakers to make affordable health care a priority.

The federal Hyde Amendment (first passed in 1976 and reauthorized every year thereafter) bans the use of federal dollars for abortion care, except for cases of rape, incest, or life endangerment. Seventeen states, as the researchers note, bridge this gap by spending state money on terminations for low-income residents. Of the 14.1 million women enrolled in Medicaid, fewer than half, or 6.7 million, live in states that cover abortion services with state funds.

This funding gap delays abortion care for some people with limited means, who need time to raise money for the procedure, researchers note.

As Jamila Taylor and Yamani Hernandez wrote last year for Rewire, “We have heard first-person accounts of low-income women selling their belongings, going hungry for weeks as they save up their grocery money, or risking eviction by using their rent money to pay for an abortion, because of the Hyde Amendment.”

Public insurance coverage of abortion remains controversial in the United States despite “evidence that cost may create a barrier to access,” the authors observe.

“Women in the US, including those with low incomes, should have access to the highest quality of care, including the full range of reproductive health services,” Grossman said in the statement. “This research indicates there is a global consensus that abortion care should be covered like other health care.”

Earlier research indicated that U.S. women attempting to self-induce abortion cited high cost as a reason.

The team of ANSIRH researchers and Ibis Reproductive Health uncovered a bit of good news, finding that some countries are loosening abortion laws and paying for the procedures.

“Uruguay, as well as Mexico City,” as co-author Kate Grindlay from Ibis Reproductive Health noted in a press release, “legalized abortion in the first trimester in the past decade, and in both cases the service is available free of charge in public hospitals or covered by national insurance.”