With new scandals cropping up seemingly weekly, I have been somewhat remiss in providing updates on the status of SurroGenesis USA, which remains the worst case of criminal activity perpetuated by a surrogate agency in U.S. history.
First and foremost, there has been no public activity or comment by the FBI. Even though more than six months has passed since the fraud came to light, there have been no arrests or any noticeable signs of progress in the FBI investigation. The FBI remains refuses to comment on the status of their investigation. At this time, one has to even wonder if the FBI still considers this an open case.
As many of you know, last month PBS broadcast an investigative special on the scandals that have rocked the surrogacy industry. Special attention was focused on SurroGenesis and Tonya Collins. You can view the broadcast online by following this link. The PBS investigation was successful in obtaining an admission from James Collins, Tonya’s husband, who acknowledged what we have previously reported: SurroGenesis was illegally securing medical insurance coverage for their surrogates by classifying them as employees so as to insure them under the SurroGenesis group health plan. There are some other very revealing moments in this broadcast and I strongly recommend it viewing it.
The Class Action attorneys, Ted Penny and Wayne Beaudoin, as part of their litigation discovery, have been able to confirm the existence of a Hartford Insurance Policy, covering Michael Charles Independent Financial with a $2,000,000 policy limit. As I understand it, this fidelity policy provided coverage for employee dishonesty but the claim must be made by one of the owners of Michael Charles Financial – not the victims of the dishonesty. Hopefully the attorneys will be able to secure the cooperation of Jack Kiserow to tender the claim, though questions remain as to whether the policy was still in force at the time of the loss.
Also, as part of their discovery, the attorneys were able to verify that Tonya Collins was co-mingling personal funds with SurroGenesis funds. From financial records subpoenaed from various banks, the lawyers have also confirmed that Collins was operating multiple accounts, frequently transferring money from the different accounts to cover overdrafts and was regularly withdrawing large sums of money for her own personal benefit. It has become abundantly clear that Collins used SurroGenesis funds as if they were her own without any regard to her obligations to her clients.
Finally, arbitration proceedings have been commenced against Creative Conception, Alternative Conceptions and Shelley Tarnoff, Esq. The arbitration actions against the two agencies arise out of their outsourcing of the trust administration to Michael Charles Financial.