NCS
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Arielle Mitton’s world turned the other way up when she realized the $50,000 she borrowed to pay for surrogacy had disappeared from her escrow account.
“That was the hardest day for me,” she advised NCS in a video chat. “I couldn’t eat. I couldn’t sleep.”
Her surrogate was 12 weeks pregnant, and in a cloud of emotional confusion, she remembers reporting the alleged fraud to a minimum of 10 federal and state regulation enforcement companies and calling her financial institution asking for mortgage forgiveness. But she says the reply was the identical. No one might assist her.
“I just felt alone. I felt abandoned,” she mentioned.
The lawsuit claims Surrogacy Escrow Account Management LLC, or SEAM, and its proprietor, Dominique Side, systemically misappropriated millions of escrow {dollars}, allegedly utilizing the funds to enrich herself and fund aspect companies – together with a clothes line and a profession as a rap and R&B singer and producer.
Mitton is one in all practically two dozen households listed in a lawsuit accusing the proprietor of a Houston-based surrogacy escrow company of stealing millions of {dollars} from their accounts, meant to pay their surrogates and canopy medical bills, to fund her lavish way of life.
The escrow funds additionally paid for Side’s “lavish trips all over the world,” designer clothes, luxurious automobiles, actual property, and membership on the “Soho House,” a sequence of personal golf equipment, the submitting alleges.
The lawsuit was initially filed by one household final month, however 22 extra households throughout the nation – in addition to prospective parents in France and Italy – requested to be part of the lawsuit, the plaintiffs’ legal professional introduced Tuesday, claiming there are “hundreds more families” victimized by SEAM’s conduct.
The lawsuit alleges Side and the opposite defendants “have lured families and their surrogates into entering into a fiduciary relationship with SEAM so they could steal their escrow funds” for his or her profit.
SEAM gives surrogacy escrow account administration providers to {couples} and ladies who’ve agreed to act as their surrogates. The company has an obligation because the meant parents’ escrow agent to maintain escrow funds, overview the bills incurred by their surrogates and distribute funds to the surrogate, the lawsuit states.
During a courtroom listening to on Wednesday, a decide issued a short lived injunction, ordering funds and belongings of the defendants be frozen all through the lawsuit. A trial within the case has been scheduled to start in January 2025, in accordance to the decide’s order.
Last month, the FBI said in a news release it was “seeking to identify potential victims” of SEAM and requested another potential victims to fill out an internet type.
The lawsuit, filed in June within the district courtroom of Harris County in Texas, names Side as a defendant, together with one in all her enterprise companions, Anthony Hall and Life Escrow, LLC, an escrow company created by Hall.
The decide’s order says in March, Hall fashioned a brand new escrow company known as Life Escrow, LLC, which is situated on the similar enterprise deal with as SEAM.
Dominique and SEAM “may have transferred any escrow funds remaining in SEAM’s accounts” as of June 14 to financial institution accounts within the identify of Life Escrow, in accordance to the decide’s order.
NCS has reached out to Hall for touch upon the lawsuit and didn’t obtain a response. But in a press release posted on his Facebook web page, Hall mentioned he defended himself from the accusations in courtroom and has agreed “to flip over particular belongings I management that may be traced to the alleged mismanagement by Ms. Side.
“I also presented a sworn affidavit from Ms. Side that states I have no insight or access to any of the funds or, processes of SEAM. Also, it states that no monies have been transferred to me fraudulently,” Hall mentioned.
Hall added Life Escrow was a ardour challenge he began in 2023, “has no financial accounts, or clients,” and was “not a front for illegal activity.”
In an automated reply to an electronic mail despatched by NCS, Side mentioned she and her company “have been notified that we are subject to an active investigation by federal authorities.”
“Under advice of counsel, I am not permitted to respond to any inquiries regarding the investigation,” her reply continued.
In a press release on behalf of the households, legal professional Marianne Robak mentioned: “This is an important step for our legal team as we fight to help those affected by this scheme receive the recovery and answers they deserve.”
“We will continue to investigate where the money went and the best course of action to hold the defendants accountable for their deceitful actions,” the assertion continued.
The lawsuit describes the defendants’ actions as “nothing short of evil,” and says greater than 800 households who belong to a non-public Facebook group for victims of the alleged scheme have been defrauded by SEAM and its proprietor for over $16 million.
Mindy and Aaron Herstein, who usually are not a part of the lawsuit however who’re members of the Facebook group, advised NCS they’re down $50,000 after utilizing SEAM’s escrow providers to pay a surrogate who’s now 24 weeks pregnant. They say after a devastating stillbirth and well being issues, they selected surrogacy because it was nonetheless their dream to have a toddler.
“We are heartbroken and devastated about losing the money that was supposed to be safely managed in a trusted escrow account for our surrogate, as that is how she was paid. Now we are down 50K, and I do not see this money ever being returned. I feel for everyone going through this at this time,” Mindy advised NCS.
The households every deposited between $31,000 and $100,000 right into a SEAM escrow account, solely a few of which was used to pay surrogates, the lawsuit mentioned.
“Troubles with SEAM came to light in June when expectant parents who had each deposited tens of thousands of dollars to pay women carrying their children learned instead that their money was apparently lost,” the plaintiffs’ legal professional mentioned in a Tuesday information launch. “Initially, it looked as though millions had vanished.”
The households had been notified by SEAM on June 4 their accounts had been put “on hold” by Capital One Bank due to “fraudulent charges,” the decide’s order states.
Ten days later, Side knowledgeable all of the company’s purchasers in an electronic mail: “Due to legal action all operations have been placed on hold. At this time, I am unable to provide further details regarding the matter,” in accordance to the order.
Arielle Mitton says she and her husband Andrew have three youngsters and after struggling for 3 years with infertility, discovered a street to surrogacy to full her household.
They linked with their surrogate in November 2023 and established their escrow account with SEAM in March by depositing $50,000. One month later, the embryo was efficiently transferred to the surrogate and the being pregnant was confirmed in May.
“I was elated. I was so happy,” Arielle advised NCS.
But her pleasure would quickly flip to deep fear when the month-to-month funds from SEAM stopped in June.
Since then, Arielle says she began selecting up further shifts at work, is in talks along with her surrogate about another cost plan, and has arrange a GoFundMe web page. But the web page has solely raised about $5,000 of her $38,000 purpose.
The decide cited proof exhibiting SEAM’s escrow accounts wouldn’t have sufficient funds to pay the households’ escrow charges, and the 23 households incurred damages ranging from roughly $12,400 to $90,400 – totaling over $1 million, not together with legal professional charges.
“The evidence shows that it is likely – and probable – that SEAM misappropriated millions of its clients’ escrow funds,” the decide wrote.
The decide decided the meant parents have a possible proper to recovering their claims as a result of it seems doubtless the defendants transferred SEAM’s belongings “in order to hinder, delay or defraud SEAM’s creditors.”
The households’ forensic accountant reviewed financial institution data exhibiting SEAM transferred the escrow funds into an working account, most of which was then transferred to different financial institution accounts, the order says.
Bank data present Side transferred greater than $2.2 million to launch her profession as “Dom,” a “racy rap and R&B singer and music producer,” in accordance to the submitting. She allegedly used among the funds to create music movies and social media content material.
The data additionally present SEAM transferred practically $5 million to pay for a bank card, which “appears to be related” to a music studio owned by Side and Hall, together with $275,000 to Side’s clothes line.
In October 2023, a designer clothes company named Nikki Green, LLC – partially owned by Side and Hall – showcased its clothes line at Fashion Week in Las Vegas, which was funded with the parents’ escrow funds, the lawsuit says.
The lawsuit alleges the defendants dedicated fraud by failing to disclose the whereabouts and the standing of their shopper’s funds, as half of a bigger scheme to defraud the households of their escrow funds.
Arielle says her coronary heart aches for all of the households within the Facebook group for victims, particularly one household who had two failed embryo transfers and now could by no means have a child.
“Every story is terrible, but that one just really got to my heart. You know, I feel lucky that my surrogate is pregnant,” Arielle mentioned. She needs to take a break from all of it, she says, however can’t cease eager about the proprietor of the company who allegedly stole her cash.
“If she’s out there listening, I would just ask her, ‘how do you sleep at night doing this to people who have already gone through so much pain in their lives?’” Arielle mentioned.
But Arielle mentioned what Side can’t take away is her “joy,” which is of being the mom to a brand new child lady who will at some point name her mother.