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Arizona official pleads guilty to fraud in adoption scheme

A former Arizona politician pleaded guilty in Utah on Friday to human smuggling and other charges in an illegal adoption scheme that stretched across three states and involved pregnant women brought illegally from the Marshall Islands.

Paul Petersen, a Republican who served as a county assessor in metro Phoenix for six years until his resignation in January, has also struck a plea agreement with Arizona prosecutors on state Medicaid-fraud charges. He’s expected to enter a similar plea in Arkansas this week.

Petersen was charged with illegally paying women from the Pacific island nation to come to the United States to give up their babies in at least 70 adoption cases in Arizona, Utah and Arkansas over three years.

Then-Maricopa County Assessor Paul Petersen leaves court in Salt Lake City in November 2019

Paul Petersen, a Republican who served county assessor in Phoenix for six years, pleaded guilty in Utah to human smuggling as part of an illegal adoption scheme. Peterson is pictured left in his mugshot and right leaving court in Salt Lake City in 2019

The women brought to Utah to give birth received little or no prenatal care and their passports were taken while they were in the US to assert control over them, authorities said. 

He pleaded guilty in Utah to three counts of human smuggling and one count of communications fraud, all felonies.

‘Today, Utah is safer. The rest of America and our friends in the Marshall Islands are safer,’ Utah Attorney General Sean Reyes said in a statement. 

It was reported in 2018 how Petersen was said to have paid for more than 40 pregnant Marshallese women to live in his four-bedroom home in Salt Lake City, Utah before placing their babies with adoptive families. 

The women were crammed into homes owned or rented by Petersen, and in one house slept on mattresses laid on bare floors in what one shocked adoptive family described as a ‘baby mill,’ according court documents. 

Prosecutors said Petersen was to pay them each $10,000 to put their newborns up for adoption. 

Petersen then charged families $25,000 to $40,000 per adoption, prosecutors said. 

The Utah investigation began after officials got a call to a human-trafficking tip line in October 2017. Staff at several hospitals in the Salt Lake City area would eventually report an ‘influx’ of women from the Marshall Islands giving birth and putting their babies up for adoption, often accompanied by the same woman.  

Marshall Islands citizens have been prohibited from traveling to the US for adoption purposes since 2003.

Petersen faces up to 15 years in prison, a $50,000 fine and a requirement to shut down his adoption practice in Utah. He is expected to plea guilty to a federal charge of harboring aliens for financial gain in Arkansas, which carries up to 10 years in federal prison.

Petersen's attorney, Matthew Long, right, previously defended his client's actions, seen in court last year

Petersen’s attorney, Matthew Long, right, previously defended his client’s actions, seen in court last year

He’ll serve the federal sentence first, and the Utah and Arizona penalties will run at the same time, Reyes said.

Petersen’s attorneys have previously said he ran a legal adoption practice and was unfairly vilified. He said little during his plea hearing on Friday.

A member of The Church of Jesus Christ of Latter-day Saints, Petersen completed a proselytizing mission in the Marshall Islands, a collection of atolls and islands in the eastern Pacific.

He later worked in the islands and the U.S. on behalf of an international adoption agency before going to law school and becoming an adoption attorney. 

Petersen’s plea in Arizona, entered on his behalf by his attorney, Kurt Altman, acknowledges he helped get state-funded health care for adoptive mothers, even though he knew the women didn’t live in Arizona. Officials have said 28 Marshallese women gave birth in the Phoenix area as part of the scheme, with Petersen helping to secure $800,000 in state-funded health care expenses.  

Prosecutors said Peterson paid Marshallese mothers $10,000 each to give their babies up, then charged American families $25,000-$40,000 to adopt them

Prosecutors said Peterson paid Marshallese mothers $10,000 each to give their babies up, then charged American families $25,000-$40,000 to adopt them 

Asked by the judge whether Altman’s summary was correct, Petersen answered, ‘It’s true.’ 

He also agreed to pay $650,000 to the state’s Medicaid system. 

Previously, Petersen had proclaimed his innocence. His attorneys have said Petersen ran a legal adoption practice and has been vilified before his side of the story comes out. 

Lynwood Jennet, who was accused of helping Petersen in the scheme, pleaded guilty late last year in Arizona to helping arrange state-funded health coverage for the expectant mothers, even though the women didn’t live in the state. She agreed to testify against Petersen.

Authorities say Jennet, who is scheduled to be sentenced on August 21, assisted the birth mothers in applying for the health benefits at the direction of Petersen. 

After Petersen was indicted in October in Arizona, the state opened a second investigation of him that centered on false paperwork that he submitted in adoption cases.

Altman said Petersen provided documents to adoptive families that contained false information incurred by a birth mother and provided records to a county juvenile court that contained false information about expenses.  

The adoptive parents are considered victims along with the birth mothers, and no completed adoptions will be undone, authorities said.    


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