Photo GalleriesCrime Watch

Actions

Maricopa County Assessor Paul Petersen in federal custody in adoption fraud scheme

Posted: 9:54 AM, Oct 09, 2019
Updated: 2019-10-12 23:34:56-04
Court documents reveal how and why officials began to investigate County Assessor Paul D. Petersen

On Tuesday October 8, authorities arrested and raided the home of Paul D. Petersen, the Maricopa County Assessor, in relation to an alleged adoption fraud scheme. Following his arrest, the scope of the alleged scheme became public, highlighting a multi-state investigation, with dozens of women potentially involved. Click on each link below for more information:

FULL COVERAGE: Petersen adoption fraud scheme arrest

Authorities raid Petersen's residence and businesses

Federal charges filed by U.S. Attorney, Arkansas Attorney General

State charges filed by Utah Attorney General

Why one family decided not to adopt a child from Paul Petersen's agency


PETERSEN MOVED TO FEDERAL CUSTODY

Officials with the Maricopa County Sheriff's Office have confirmed that Paul Petersen has been transferred to federal custody.

Petersen was first arrested earlier this week in connection an alleged adoption fraud scheme stemming from the Marshall Islands. Petersen is expected to be in Arkansas by October 29 to face a federal magistrate on multiple charges, including wire fraud and mail fraud.

U.S. Attorney for the Western District of Arkansas Duane "Dak" Kees spoke to ABC15 by phone, saying they had sent a "writ" to Arizona to ask for first dibs in trying Petersen for his alleged crimes.

"We are essentially saying we would like to borrow him for our trial," said Kees.

He added that during that federal trial, Petersen is expected to face four of the Marshallese women who were brought into the United States to deliver babies that were then sold to other families.

Kees called the case 'horrifying' and said how the women were housed was very disturbing.

"We found that he was sometimes putting up to a dozen women in a single-family dwelling. Four to five pregnant women in one bedroom with one bed. So there were pregnant women about to give birth, who were sleeping on the floor," said Kees.

He added that one of the women had told authorities that she was 'kept like property.' ABC15 asked Kees to elaborate on that statement.

"She was told what to do, when to do it. Wanting to go home but couldn't go home until she gave birth, a good portion of her freedom was taken away from her when she was brought over to the United States," said Kees.

Investigators say Petersen was instructing the expecting mothers to lie to customs when they got to the United States and to say they were not here for adoption, they were here for other reasons.

Kees said if found guilty, Petersen faces a lengthy prison sentence.

"If he were to be found guilty, and that is a big if, and if the judge gave him the maximum possible sentence, it would be a 315-year sentence and a $5 million fine," Kees said.

There is no parole in the federal system. Kees said after the trial in Arkansas, Petersen would be sent back to Arizona to answer to state charges.

Petersen is also facing charges in Utah.


ADOPTIVE FATHER STANDS BEHIND PETERSEN

ABC15 talked exclusively with one man who says he has adopted three young Marshallese kids with the help of Petersen, and the situation has been “fantastic since day one.”

The man, who asked not to be identified, says he was blindsided by Petersen’s arrest.

When asked if he got the feeling Petersen was doing anything wrong, he replied, “There are no women who have been forced to do anything that they didn’t want to do. This isn’t anything close to trafficking, in any way shape or form.”

The man describes that work Petersen did as life changing. “It may look bad from the outside, but he’s doing them a service or favor by helping them get out of a predicament that they would otherwise not want to be in.


THE INVESTIGATION INTO PAUL PETERSEN

Court documents obtained by ABC15 show how and why officials began investigating Maricopa County Assessor Paul D. Petersen's alleged involvement in an adoption fraud scheme.

In December 2018, court documents show that the Arizona Department of Public Safety received information regarding suspicious activity involving an Arizona attorney "conducting adoptions of babies from the Republic of the Marshall Islands (RMI)."

The United States and Republic of the Marshall Islands have an agreement known as the "Contact of Free Association."

"According to the compact, RMI citizens are able to live and work in the United States without a work Visa," court documents state. "However, if a person is coming to the United States for the purpose of an adoption transaction, they are ineligible for admission under this compact. Based on the compact, adoption of Marshallese babies born to Marshallese mothers must go through the Central Adoption Authority which is an entity of the RMI."

Watch the full press conference from Arizona officials on the arrest below.

A source who was not named in court paperwork allegedly went to Petersen regarding child adoptions after being referred by an unidentified third party.

The source contacted DPS detectives because he believed "the practices outlined by Petersen during their correspondence were suspicious."

Throughout DPS' investigation of Petersen, they allegedly discovered the following, as listed in court documents:

  • Petersen has been involved in the adoption of Marshallese babies since at least 2005
  • Between November 30, 2015 and May 30, 2019, investigators identified 28 women and 29 births. One woman gave birth to two children
  • All the women identified were from the Republic of the Marshall Islands, gave birth in the Phoenix area, and subsequently gave their children up for adoption

DPS' investigation revealed a pattern in Petersen's adoption practices. They are outlined as follows in court documentation:

  • Petersen, with the assistance of "several individuals in the RMI and the U.S." who were on his payroll, found and matched birth mothers with adoptive families
  • Petersen allegedly charged adoptive families $35,000 per adoption, which included fees for medical costs. However, all 28 women who gave birth in the greater Phoenix area allegedly had their medical expenses covered by the Arizona Health Care Cost Containment System (AHCCCS).
  • Petersen sent money to the Republic of the Marshall Islands for the birth-mothers to purchase passports
  • Petersen allegedly paid for the pregnant women to fly to Phoenix and stay in a home owned by Petersen for the duration of their pregnancy

Officials: Maricopa County Assessor Paul D. Petersen indicted in adoption fraud scheme

Court records show that when women were ready to give birth, they were assisted in applying for AHCCCS benefits. Once they had the child, the mothers were transported from Arizona back to the Republic of the Marshall Islands. In some instances, the women were driven or flown to Arkansas, according to court documents.

DPS' investigation also revealed a pattern in the way Marshallese women were handled in the months leading up to and following the birth of their children. Sometimes, women were flown to Phoenix days before giving birth. Others arrived in the U.S. up to six months prior to to the delivery of the child. In almost every case, a flight out of Arizona was booked "shortly after the delivery of the child," court records show.

Investigators say they believe the Marshallese women participated in Petersen's adoption fraud scheme because they were allegedly paid $1,000 a month by Petersen while they were pregnant in the U.S.

In addition to the $1,000 monthly payments, the women were provided with accommodations including food, travel and cell phone payments.

Investigators also allege some birth mothers "were promised up to $10,000 to place their unborn baby up for adoption by Petersen and/or his associates."

During a raid of several locations belonging to Petersen Tuesday night, eight pregnant Marshallese women were located.

Attorney General Mark Brnovich says none of the women who gave birth did anything illegal, and none of the families that adopted children are accused of any crimes. Adoptions that are pending in other states involving children from these schemes will be looked at on a case by case basis.

Petersen allegedly employed Marshallese women in Arizona, Arkansas and Utah. These employees were allegedly responsible for:

  • Care for the birth mothers which included translation service, food shopping and the acquisition of material goods
  • Helping the birth mothers apply for Medicaid (AHCCCS) benefits
  • Transporting birth mothers to and from doctors appointments
  • Notarizing legal documents pertaining to the adoption of children in Arizona

AHCCCS investigators believe Petersen's adoption fraud scheme has cost the state of Arizona at least $800,000 in medical expenses for the 28 birth mothers. That number is expected to rise, according to Brnovich.

According to investigators, none of the 28 birth mothers have been found living in Arizona since the investigation began.


ARIZONA, UTAH, AND ARKANSAS FILE CHARGES AGAINST PETERSEN

Officials from Arizona, Arkansas, and Utah all held simultaneous press conferences on October 9 to share information on charges against Petersen.

The U.S. Attorney for the Western District of Arkansas, the U.S. Department of State's Diplomatic Security Service, the FBI, and the Arkansas Attorney General announced 19 federal charges.

The federal charges include one count of conspiracy to smuggle illegal aliens for commercial advantage and private financial gain, four counts of aiding and abetting in alien smuggling for commercial advantage and private financial gain, seven counts of wire fraud, five counts of mail fraud, one count of conspiracy to commit visa fraud, and one count of conspiracy to commit money laundering. Click here for more information on the federal charges filed in Arkansas.

Watch Petersen's first court appearance in the player below:

Utah Attorney General Sean D. Reyes announced 11 state charges against Petersen.

Those charges include four counts of human smuggling, three counts of sale of a child, three counts of communications fraud, and one count of pattern of unlawful activity. Click here for more information on the Utah charges.

Including the 32 charges filed in Arizona, which include conspiracy, fraudulent schemes and practices, theft, and forgery, Petersen is facing a total of 62 federal and state charges.


ONE FAMILY SPOTS RED FLAGS WITH PETERSEN

Julie is a parent of six children, four of whom are adopted. However, none of her adopted children are from Petersen's agency due to all the red flags she says were raised during their time talking with him.

Within days of speaking to Petersen, Julie and her husband were matched with a pregnant woman in Utah "right away," a rarity in the adoption world, where it can take months, sometimes years for adoptive parents to match with a birth mother and child.

"That's just not how adoption works," Julie said in an interview with ABC15.


WHAT HAPPENS TO THE MARICOPA COUNTY ASSESSOR ROLE?

Paul Petersen is an elected official.

Since Petersen is an elected official, he would have to step down from the role. So, even if constituents demand a replacement, the Board of Supervisors ask and Republican political operatives plead with him, none of it matters.

Whether or not Petersen steps down because of the crimes he is accused of committing is his decision alone to make.

Petersen is being held on a $500,000 bond. His next court appearance is scheduled for October 15 at 8:30 a.m.