Source: Office of United States Attorneys
SAN DIEGO – Lillian Arielle Markowitz, former owner of three San Diego-based surrogacy consulting businesses, pleaded guilty in federal court today to fraud charges, admitting that she stole hundreds of thousands of dollars in client funds from escrow accounts set up to pay for surrogacy-related services.
According to her plea agreement, Markowitz admitted that she owned three businesses — My Donor Cycle, Surrogacy Beyond Borders, and Expecting Surrogacy — through which she marketed herself as a surrogacy consultant to those seeking to realize their dreams of becoming surrogate parents. Beginning around 2018, when Markowitz and her businesses began to experience financial distress, she devised a scheme to steal money from her surrogacy clients by, among other things, submitting fraudulent requests to the escrow company where her clients’ funds were maintained.
Markowitz admitted to submitting four fraudulent escrow disbursement requests from the escrow accounts of two couples. One included what Markowitz knew to be a forged client signature, and each one resulted in her obtaining a check from the escrow company without the knowledge or consent of her clients.
In addition, Markowitz admitted that beginning in January 2019 and continuing through May 2021, she defrauded nine additional clients by falsely promising their funds would be deposited into an escrow account and that they would be accessed only to pay for expenses related to their respective surrogacy journey. In fact, Markowitz deposited these clients’ funds into a business checking account and immediately accessed those funds to cover general business expenses, expenses related to other clients’ surrogacy journeys, and her personal expenses. As a condition of her plea, Markowitz has agreed to make restitution of at least $389,142.00 to her former clients.
“The path to parenthood through surrogacy can be fraught with emotional and financial challenges,” said U.S. Attorney Tara McGrath. “This defendant selfishly exploited vulnerable clients who were striving to fulfill their dream of becoming parents.”
“Instead of aiding her hopeful clients on their path to parenthood, the defendant took advantage of their vulnerability, betrayed their trust, and stole their money,” said FBI San Diego Special Agent in Charge Stacey Moy. “FBI will continue to investigate these unique fraud schemes to protect the public against those who employ empty promises and prey upon vulnerable individuals.”
Markowitz is scheduled to be sentenced on April 11, 2025, at 9:30 a.m., by District Judge Todd W. Robinson.
If you believe that you may be a victim in this case, please contact the FBI San Diego field office at (858) 320-1800.
This case is being prosecuted by Special Assistant United States Attorney Jeffrey D. Hill and Assistant U.S. Attorney Mark W. Pletcher.
DEFENDANT Case Number 24-CR-0904-TWR
Lillian Arielle Markowitz (aka Lillian Frost) Age: 40 Portland, OR
SUMMARY OF CHARGES
Wire Fraud – Title 18, U.S.C., Section 1343
Maximum penalty: Twenty years in prison and $250,000 fine
INVESTIGATING AGENCY
Federal Bureau of Investigation