SALT LAKE CITY, Utah, June 18, 2020 (Gephardt Daily) — Former Maricopa County assessor Paul Petersen pleaded guilty Thursday in Arizona to four felony charges relating to Medicaid fraud, in a case that stemmed from his international adoption practices.
The same practice led the Utah Attorney General’s Office to file charges against Petersen for human smuggling, communications fraud, and other felony offenses in October 2019, said a news release from the AG’s Office. Petersen is expected to plead guilty to four felony charges in Utah on Friday. Details will be provided during a news conference at 1 p.m. following the plea in Utah.
Petersen faces charges in Utah, Arizona and Arkansas related to recruiting, transporting, and offering payment to more than 40 pregnant Marshallese women to place their babies for adoption in the U.S.
The Utah Attorney General’s office was first made aware of the case after a tip came through the AG’s human trafficking tip line from concerned hospital workers in 2017. The Attorney General’s Office worked with multiple agencies in Arkansas, Arizona, and the Marshall Islands during its investigation.
“Petersen’s illegal adoption scheme exploited highly vulnerable groups in two countries — the birth mothers and families in the Marshall Islands and the adoptive parents here in Utah,” Utah Attorney General Sean D. Reyes said when the charges were filed.
Petersen was arrested in California on Oct. 8, 2019, a previous news release from the Utah AG’s Office said.
“Petersen is alleged to have run an illegal adoption scheme where he recruited, transported, and offered payment to pregnant Marshallese women to give their babies up for adoption in the United States,” the news release said.
Petersen was charged with 11 felony offenses in Utah, including human smuggling, sale of a child, and communications fraud.
He was indicted on 32 felony counts by the Arizona state grand jury for his alleged involvement in the adoption fraud scheme. The charges include one count each of conspiracy, theft, and forgery, and 29 counts of fraud.
Petersen also was indicted by federal authorities in Arkansas.
He is also accused of using false information to place the Marshallese women on state-funded healthcare in Arizona to pay for delivery costs, allegedly bilking the state of more than $800,000, and possibly more than that, the news release said.
Petersen allegedly purchased travel arrangements for the women to travel to Arizona for the sole purpose of giving birth. After the women gave birth and the children were placed for adoption, Petersen allegedly purchased travel for the birth mothers to travel to other states in America, or back to the Marshall Islands.
The families that adopted the children are not under investigation and are not the focus of the investigation, officials said in October.
Col. Frank Milstead, director of the Arizona Department of Public Safety, said it is alleged Petersen would charge around $35,000 for each adoption, and the woman would be paid around $10,000, but Petersen would then “siphon money off the top of that for healthcare, housing and transportation and more.”
The crimes were first uncovered when an “astute” trooper named Sam Hunt was contacted by a friend who had gone to the law offices of Petersen to adopt a child, Milstead said.
“After the initial meeting, this particular person was concerned about the legitimacy of the process and the fees involved in the process and talked to our detective trooper,” Milstead said.
Milstead clarified that people from the Marshall Islands, which are between Hawaii and the Philippines, can “come and go in the U.S., stay in the U.S. and live here, without restrictions on time,” so the women are not here illegally, but they’re not allowed to undertake the adoption process here in the U.S. It doesn’t appear at this time the women will be facing charges.
The initial news release from the Utah AG’s Office said there has been a long history of adoption-related exploitation in the Republic of the Marshall Islands and, for this reason, adoptions between the U.S. and the Marshall Islands “are governed by an Interstate Compact that prohibits this type of international adoption.”
Gephardt Daily will have more on this developing story as information is made available.