Babies 'sold for $150,000' in California

Theresa Erickson built a name for herself as a highly skilled reproductive law specialist in California - the state considered the nation's hub for surrogate pregnancies.

But prosecutors say she was running a birthing factory out of the Ukraine in an elaborate scheme stretching across two continents.

Now Erickson has pleaded guilty to fraud charges in a case that prosecutors say highlights the need for more protection for adoptive parents, children and surrogate mothers.

Erickson and two others allegedly recruited women to go to the Ukraine and be implanted with embryos from anonymous donors.

They told their clients the babies had been part of a surrogacy contract and that the prospective parents had backed out at the last minute, Assistant U.S. Attorney Jason Forge said.

In fact, he said, there were never any such parents or contracts. The three were instead paying the surrogate mothers between $38,000 and $45,000 for each successful pregnancy and keeping the rest of the adoption money for themselves, Mr Forge said.

They also misled the parents into believing they knew who the sperm and egg donors were when they were anonymous, he said.

Erickson also admitted to filing false applications for the surrogates to California's state insurance program to subsidize the medical costs of the deliveries of the babies.

The case highlights the need for more protection for the vulnerable adoptive parents, the babies involved and the surrogate mothers, Mr Forge said.

He estimates Erickson raked in at least $70,000 alone from the scheme.

The parents will not lose their parental rights because they did not know any laws were being broken, Mr Forge said.

Erickson pleaded guilty to conspiracy to commit wire fraud. She has been ordered to pay each of the 12 couples $10,000 in restitution and up to $250,000 in fines to the government. She and the other two women face up to five years in prison when they are sentenced in October.