Hearts Broken After Surrogate Agency Closes

There's a heart-wrenching emergency affecting hopeful parents across the country; couples who say an Internet-based fertility business promosed to help them start their families but instead robbed them of their money and hope.

Beth and Marcio Mardones of Lake in the Hills looked at surrogacy as an option after doctors said a rare form of cervical cancer could be best treated with a radical hysterectomy.

They settled on SurroGenesis USA, a Modesto, Calif. company that the Mardones' said seemed to have all their ducks in a row. With offices all over the country, including three in the Chicago area, the businesses touted glowing testimonials on its Web site and initially presented a business model that trumped others.

"So that's what we really liked about SurroGenesis, was that we were able to profile and see what surrogates they have," Beth Mardones said.

Over two years and three separate attempts, the couple said they spent $42,000 trying to have a baby. Without warning, SurroGenesis shut down in March, notfiying clients like Beth and Marcio Mardoes that the money they held in escrow, at Michael Charles Independent Financial Holding Group, a firm recommended by SurroGenesis, was missing.

"I panicked," Beth Mardones said. "I thought, 'This isn't right.'"

The development threw clients worldwide into a dramatic dilemma: prospective parents were out of their life's savings, without babies, and currently pregnant surrogates were not getting paid for their medical care.

"The human angle, the emotional loss is just awful," said California plaintiff’s attorney Ted Penny, who plans to file a class action lawsuit on behalf of some victims this week. "I was about to say that it's greater than the financial loss, but when you lose between $75,000 and $90,000 -- and along with it your hopes for having a child -- it's impossible to separate the two."

Penny said that dozens of families are suffering while the SurroGenesis owner, a woman identified as Tonya Collins, appears to be walking free.

"Everyone keeps asking, 'Why isn't this individual in jail? Why haven't we seen a prosecution?" Penny explained.

According to California records, Collins not only owned SurroGenesis, but she was also the registered agent for the financial company that held an estimated $2 million to $3 million of client money in escrow.

Clients who put their trust in Collins and her business now wonder if it was misplaced.

"Through all these years she's had access to both accounts and misrepresented herself," Beth Mardones said. "I truly don't know how she can even sleep at night."

Among the many revelations surfacing about the agency: some of the nationwide locations, like one in Highland Park, were nothing more that P.O. boxes.

Now the same tool that helped hopeful parents find SurroGenesis is now helpig them find each other. Through the Internet, victims have banded together. The Federal Bureau of Investigation said it is evaluating complaints.

An attorney for Collins offered no comment other than to say that he has been retained to represent her on criminal -- not civil -- matters.

But for would-be parents, it's not just about the money.

"The finance is one part of it, but then there's the emotional side of it," Beth Mardones said. "It's really tough."

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