Posts Tagged ‘escrow’
Workin’ 9-5 With an Escrow Agent
July 8, 2020 | By: Liz
My good friends at Private Label Surrogacy recently asked me to help educate their prospective clients and gestational carriers about escrow agents. What is it that escrow agents do and why is it important?
Trust me that you don’t really want me to tell you the specific ins and outs of my day at Stork Escrow unless you want to fall asleep from boredom in the next few minutes. My life as an escrow agent “workin’ 9-5, what a way to make a livin’” (as Dolly sings it), is not the subject of this blog, nor should it be the subject of any blog because “it’s enough to drive you crazy if you let it”.
Fortunately for those reading this blog, it turns out the question was more general than asking about the specifics of what I do while I’m ‘waitin’ for the day my ship’ll come in.” Among other questions (which I will address in another part of this blog series), my friends at PLS wanted to know what the difference is between fund managers and escrow agents and when and why you need to hire one of us.
Well then, let me discuss “my service and devotion” . . . .
Nomenclature aside, escrow agents and fund managers are (or should be) the same thing: people or companies who are responsible for holding and distributing the money needed for surrogacy and egg donation arrangements. We exist to protect the people and the money involved in these third-party assisted reproduction arrangements.
In fact, I opened Stork Escrow with my partner Kelly DuMont to do just that: we “poured ourselves a cup of ambition” to protect the people involved in surrogacy and egg donation arrangements from financial harm. Kelly and I both had experience managing escrow accounts for third-party assisted reproduction and we had both heard some really sad stories of people losing their life savings from surrogacy and family building scams where money was stolen from the intended parents and the surrogate by people at the agency involved in the surrogacy arrangement. Kelly and I decided to work together to try and find a better way to protect people from getting hurt financially while they worked to build their dream family.
How escrow agents or fund managers achieve this goal—safeguarding the money and protecting people from getting hurt financially—is achieved in different ways and it’s sometimes dependent on state law. To some extent, where your surrogacy is going to take place may dictate some of the terms of your escrow arrangements.
California’s surrogacy statute, for example, has provisions pertaining to who can hold the funds and in what type of an account. If a licensed and bonded escrow agent is not used, California requires that funds be held in an “attorney trust account”. There are different types of attorney trust accounts that can be used but the bottom line is that these accounts are only available to attorneys and hold the attorneys to very high standards regarding the management of the funds. In contrast, some states require that independent or third-party escrow agents hold the money but don’t specify the type of bank account in which the funds must be held.
New York just passed new surrogacy legislation, the Child Parent Security Act (CPSA) which goes into effect in February of 2021. The CPSA requires that any party to a surrogacy arrangement deposit the money needed for the surrogacy with an independent escrow agent. New York feels that an independent third party provides necessary separation from the parties interested in the financial transactions involved in a surrogacy arrangement in order to protect everyone involved. In this context, the funds must be held by someone who has no relationship to the agency or to the people involved in the surrogacy arrangement.
Using an independent escrow agent prevents self-interest from interfering in the management of the money needed for the surrogacy journey. You don’t want it to be all “takin’ and no givin’” like that scam I mentioned. You want to know that no one is going to be taking your money except to give it to someone who legally is entitled to have it.
And that is really the answer. If you want to know what an escrow agent or fund manager is, what we’re supposed to do, and why we exist, that’s your reason: We are here to protect the money that the intended parents need to deposit to cover the surrogacy or egg donation expenses and we make sure it gets paid to the surrogate or egg donor in accordance with the terms of their respective contract. Call us whatever you want, escrow agent or fund manager, at the end of the day regardless of our name or title, our job is the same: to protect the financial interests of the parties to a gestational surrogacy or egg donation arrangement.
Third party assisted reproduction is a “rich man’s game, no matter what they call it”, and you may be using your life savings to make your family a reality. You want to know that you are not putting your money into “another man’s wallet”.
Why do you need an escrow agent or fund manager? “Well you’ve got dreams [s]he’ll never take away.”
Do all escrow providers offer the same fund security? What are the different types of accounts used to hold funds and does it matter what type you use? What are the most important questions to ask your surrogacy agency about escrow fund management?
Filed under: Egg Donation, Family Building Law, Financing Fertility Treament or Adoption, fund management in third-party assisted reproduction, Gestational Carrier, Gestational Carrier Arrangements, Infertility Awareness, New York Reproductive Law, Reproductive Law, Surrogacy, surrogacy escrow management, Surrogacy in New York, Third-Party Assisted Reproduction, Uncategorized
Tags: egg donation escrow, escrow, fund management, surrogacy escrow
Surrogacy Symplified — The Masked Marauder of Misinformation Unmasked!
July 28, 2012 | By: Liz
My phone has been ringing off the hook with questions from prospective clients about surrogacy. Everyone with whom I speak is terribly confused and seems to have received bad or misinformation from someone or somewhere. At first I thought it just a coincidence but now I wonder whether there is someone out in the world spreading vicious rumors about surrogacy thus causing many, many people to live as if they were in the fun house at the amusement park — you know the one with all those crazy mirrors that makes you look totally distorted (and always insanely fat or ugly) — sadly thinking that surrogacy is or will not be an option for them for building their family. As if the world of infertility wasn’t enough of an amusement park fun house, we now need the NOvary(tm) to have another partner in crime, a masked marauder (or perhaps multiple marauders) disseminating incorrect information about surrogacy? I don’t think so!
I’m going to take this opportunity to try and clarify surrogacy and all it’s intricacies especially in New York (most of them legal issues so it’s a good thing I’m a lawyer). As we are dealing with this Masked Marauder of Misinformation (who hereinafter shall be referred to as “MMM”), I am putting on my favorite caped crusader costume (wanna guess which character it is?) and I am taking the MMM, DOWN!
So what is my biggest beef with our friend the MMM? Mostly that s/he is telling everyone, including doctors, things about surrogacy that are so totally wrong people think surrogacy is not an option for them when in fact it may be a very viable option to become a parent. For some of us, surrogacy is our ONLY option to become a parent, and in this case MMM is doing the greatest disservice by making people believe that unless they MOVE half way across the good ol’ USofA they won’t be able to have a baby (and yes, one person with whom I spoke recently was told he would have to move to a different state in order to become a parent).
Before I begin my discourse and try and simplify these issues so you have the basics under your belt, I want to state for the record that I have no clue who or what MMM is or why all of this wrong information is circulating. Nor do I think MMM is one person. Rather, I think MMM is a combination of information being provided by physicians and their staff, people’s well meaning friends, and the Internet.
We know we all have to be careful about what we read on the internet (including this blog, don’t rely just on me, if you want to pursue surrogacy please find a good reproductive lawyer, find out what laws are going to apply to your individual situation and then start the process). So if you are reading this because you’ve had a web-based MMM encounter, I’ll do my best but I don’t know what you read and where you read it.
With respect to what our friends tell us, if your MMM experience came from a well-meaning waiting-room compatriot . . . well my attitude about that is that unless they actually went through it, they know Bubkis (Yiddish or born and bread NY’er for: “nothing”, “jack sh-t”, or “less than nothing”). And even then, when I say went through it, there is a vast array of what people think they “went through” as an infertile person. There is nothing more annoying than the person who goes on an on about how hard their battle with infertility was and how painful, expensive, and emotionally demanding it was (as you listen and think “OMG I’ve finally met someone who ‘gets it'”) and then you find out they did two IUI’s and conceived twins and are back for number three. Whereas you did 5 IUI’s and are on your third IVF cycle and also have had a miscarriage somewhere in there and, you’re still trying for number one! (BTW, doesn’t that just drive you crazy, those people who did one or two IUI’s — and who no doubt suffered — and who think they know how you feel; who think they have a clue how hard infertility can be?!?). So in this context I am not just talking about infertility, I mean surrogacy, and unless your “friend” had a child or attempted to have a child through surrogacy you have most definitely had an encounter with MMM.
With respect to information provided to you by a physician, here I must tread carefully. All I can say is that yes, you have had an experience with MMM. As noted above, in this blog I am addressing the legal issues because I am a lawyer. I defer medical issues to dr’s because even when I put on my “white doctor’s coat” (ala The Infertility Survival Handbook), I acknowledge that I did not go to medical school or become a licensed, board certified reproductive endocrinologist and thus should not be considered to be providing medical advice or information (although the book was read by three physicians before going to print). Just as I will not talk about medical issues to which I may not have full and complete information, I don’t think doctors should be giving you legal information. Some of my colleagues and I have a real “thing” about how frequently doctor’s do and say things that constitute practicing law without a license. It’s MMM at its most annoying (and personally offensive).
What MMM myths do I need to dispell or simplify? Well let’s start with what is annoying me the most and what I know most about: surrogacy in NY.
Contrary to the MMM you have heard, you CAN do surrogacy in NY!! However, MMM is definitely impacting people’s ability to do it as many clinic’s are so afraid of surrogacy laws in NY that they won’t even discuss it or do an embryo transfer even in a completely legal, uncompensated compassionate surrogacy arrangement. What you cannot do (and dr’s should not do) is an embryo transfer within the State of NY when your surrogate (a/k/a gestational carrier) is being compensated and lives in and will deliver in NYS. A NY State resident cannot carry a baby for another NY State resident for compensation above and beyond limited pregnancy-related expenses (please talk to a reproductive lawyer, adoption attorney, or family lawyer about what expenses are considered “pregnancy-related” and would be permissible under NY law). If you have a friend or family member who is willing to carry a baby for you for free that is amazing, and legal. If she needs reimbursement for pregnancy-related expenses that MAY be okay, depending on the type of expense and the amount (this where you need legal advice). I typically am very strict about whether or not these expenses can be paid; I am very conservative because I don’t want anything to cause problems when I am getting birth certificates and just like every where else in the world we go, you get the wrong judge and what you know is legal, permissible and you have even done before, THIS judge won’t let you do! Indeed, I was reading an article written in The Family Advocate, a magazine published by The American Bar Association for its members, written by my colleagues Diane Hinson, Esq., & Maureen McBrien, which addressed the status of surrogacy laws around the country, and they printed a quotation from another reproductive lawyer that made me laugh out loud: “[a]s one ART attorney put it, the result in any given case can depend on ‘which elevator button you need to push at the courthouse.'”
So the bottom line in NY is that if you have a friend or family member who will carry a baby for you, who will be your surrogate, you can enter into a surrogacy arrangement with her. She cannot be compensated or paid the way surrogates are in many other states, but depending on circumstances, she may be entitled to reimbursement of minimal expenses directly related to the pregnancy. You also can obtain birth certificates with your names on them. You will need legal documents before you can do the embryo transfer and it is very important you have these documents prepared. However, the documents you will have prepared are different from gestational carrier or surrogacy “contracts” and are not enforceable the way surrogacy contracts are in certain other states. That said, the documents your attorney will prepare for you can be very helpful if something were to go wrong during the pregnancy or after birth, and may also help your attorney get the birth certificate. Every attorney has their own practices and procedures (in every state), so you may want to interview a couple of attorneys to find one whose personal practice make you feel the most comfortable.
One issue you may have, however, is finding a doctor in NY to perform the embryo transfer even when you are doing a compassionate surrogacy like that which I have been describing. Unfortunately, due to the power of MMM, some clinics are electing NOT to do any embryo transfers under any circumstances or fact patterns, period. They are losing business by taking this position and it’s sad when you have been working with a clinic for years and they tell you that you need a surrogate, your sister agrees to carry the baby for you for free, and your beloved doctor refuses to do the embryo transfer. I am so upset by this increasing trend that I have on my (way too long) “To-Do” list, to write a white paper or perhaps law review article on why doctors are wrong to take this position.
However, in my opinion doctors may not be wrong in declining to perform embryo transfers in the State of NY when the surrogate is going to be compensated, or paid when she resides in a state in which surrogacy is legal. If you have found a surrogate in Illinois, a State in which surrogacy is legal and reasonably easy to do, you likely cannot bring your Illinois surrogate to NY to do the embryo transfer at your clinic even if this is where your embryos are stored. There are a few clinics that may do the embryo transfer if everything about the surrogacy is legal in another state, in this case Illinois, but arguably because you are a NY resident and the embryo transfer is taking place in NY, a doctor might be found to be violating NY’s statute against facilitating paid surrogacy arrangements. Arguably, this statute was meant to apply to paid surrogacies taking pace within the state of NY (not Illinois) but a your doctor may not want to risk a potential felony violation over an issue of statutory interpretation.
MMM aside, as a NY resident you also have the option of locating a surrogate in a state in which it is legal to compensate the surrogate (Connecticut is another example of a state in which compensated surrogacy is legal), and once you have all the appropriate legal documents in place, you can either have any frozen embryos transferred to CT or undergo the IVF cycle in CT with your surrogate undergoing the embryo transfer procedure. The baby will be born in CT and you will obtain a CT birth certificate with your names on it.
So let’s recap for NY’ers: MMM notwithstanding: it is not illegal to enter into a surrogacy arrangement. You can either find a friend or family member to carry the baby for you within (or outside of the state) New York or you can find a surrogate in another state, preferably a surrogacy friendly state, to carry the baby for you, and you will compensate the surrogate. Depending on the State, whether New York, Illinois, or Connecticut, you will need legal documents before the embryo transfer can take place; and the process by which you obtain birth certificates with your name on it differs between the states and even within a state (they can vary county by county and even sometimes Judge by Judge — this is why I cracked up over the elevator button quote; it’s beyond accurate).
You will need a reproductive lawyer in the state in which your surrogate is to deliver the baby to tell you what that process will be AND what needs to be included in the agreement you enter into BEFORE you do the embryo transfer (the surrogacy agreement or contract). Florida, for example, requires that specific statutory language be included in your surrogacy contract. BTW, another MMM fact to dispel. If you enter into a surrogacy in Florida, you are NOT adopting your baby. You are doing a surrogacy or gestational carrier arrangement just as you would be in Illinois or Connecticut (or many other states). The MMM on this issue stems from the fact that the surrogacy statute is included within the Florida Adoption Statute. Just because the surrogacy provisions are contained in the adoption statute does NOT result in or mean that you are adopting the baby, your baby, which your surrogate delivers in Florida. A reproductive lawyer in Florida can explain this process in greater detail.
Wherever you live, whether NY or another state, MMM has led to lots of confusion over what you can and cannot do with respect to surrogacy. NY’ers are, I think, experiencing the most confusion right now. Hopefully statutes will be passed in the next year or two that will make almost all forms of surrogacy legal in NY, and which will permit NY’ers to stay in NY to have their babies via surrogacy. A member of the NY legislature, Amy Paulin, has introduced a bill that will make surrogacy legal in NY. She needs help from her constituents and other residents of the State of New York, so if you are interested in helping another state become surrogacy friendly, please seek her out on FaceBook (she specifically requested that people post to FaceBook) or send her a letter in support of her efforts. Please, for me??? FaceBook, quick post, Go Amy, Go Surrogacy, Go NY!
Surrogacy is easy in many states, but due to MMM many people are confused over the process, the steps involved, and the cost. Some of the confusion is well-founded. As noted above, in some states it can depend on the Judge to whom you get assigned which will determine how easily you will obtain a birth certificate or whether it can be done pre or post birth. Many states have set procedures by statutes, others rely on cases decided by Judges, and still others prohibit it altogether or prohibit certain aspects of it. Traditional surrogacy (where the surrogate uses her own egg to become pregnant) is illegal in many, many states and if you enter into this type of surrogacy you may well have to adopt the baby in order to legalize your parental rights; and you are still at risk for the surrogate to assert parental rights as it is her genetic material she is carrying.
The questions you need to ask are as follows:
Is surrogacy legal where I live, and if so what restrictions (if any) are there on the process, what documents do I need to have prepared before embryo transfer, and what steps need to be taken to establish my parental rights? If using an egg donor in addition to a surrogate, does that impact any aspect of the process? You may for example, need to do a second-parent or step-parent adoption in the state in which you live in order to establish the parental rights of the non-genetic parent. Do not rely on anyone other than a reproductive lawyer, adoption attorney, or family lawyer to answer these questions for you. MMM runs rampant in this area of the law and in fact, the law changes fairly quickly so what may have been true a few years ago, if told to you now, may well result in a run-in with MMM. Other blogs I have written have addressed the questions you need to ask or legal documents you need to have prepared when entering into a surrogacy arrangement in greater detail than I did in this post. If you are considering surrogacy, you may want to explore those posts for additional information.
There is a wealth of information that you need as you start on this path, topics we haven’t touched on are issues related to insurance and escrow or trust account management. These subjects are less frequently discussed (and extraordinarily important) so less often subject to MMM encounters. I plan on blogging about them and am working on an series of books to demystify third party assisted reproduction in general.
But whatever you do, don’t take what people (even your doctor) tells you at face value! The Masked Marauder of Misinformation is just as stealthy as the NOvary! I am so jaded that I sometimes feel like a client is describing an MMM encounter from a friend who does not want my client to have a baby and thus has filled his or her head with utter nonsense out of nothing other than jealousy (how sick and twisted am I?) Or, political issues within a reproductive practice are causing a client to draw assumptions about surrogacy — MMM that surrogacy is illegal because her clinic won’t do an embryo transfer to an uncompensated surrogate — that are just plain wrong!
Beware the MMM. There are so many options for becoming a parent through surrogacy that odds are you can find a way to do it. Don’t believe everything you hear! Got a question, get an answer, just make sure it’s not from the Masked Marauder of Misinformation!!
Filed under: Birth Certificates, Birth Orders, Current Affairs, In the News, IVF, Parentage Orders, Personal Musings, Pre-Birth Orders, Questions about the Office, Sam Sex Parenting and Reproductive Law, Same Sex Parenting and Reproductive Law, Surrogacy in New York, The Journey to Parenthood, Third-Party Assisted Reproduction, Uncompensated Surrogacy
Tags: adoption, Birth Mother, birth orders, embryo transfer, escrow, gestational carrier, infertility, IVF, Parentage, pre-birth orders, state laws, Surrogacy, surrogate, trust account