Surrogacy scam: Sarasota couple joins 23 families in suing woman accused of taking $6M for lavish lifestyle

SARASOTA, Fla. - A Sarasota couple thought their money was being paid to the surrogate carrying their child. Instead, attorneys said it was used to fund a lavish lifestyle, fancy cars and an aspiring rap career. 

The woman at the center of it all is now accused by 23 families across the country and two in Europe of ripping them off. The FBI is now investigating the case. 

"I have multiple autoimmune diseases, so we thought this would be a great way to build our family," intended parent Kelly Palladino said.

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Surrogacy became the best option for Palladino and her husband Daniel, so last fall they hired an attorney, found a surrogate through an agency and did the transfer. They brought in Dominque Side, who owned the Houston-based escrow firm Surrogacy Escrow Account Management (SEAM) to facilitate payments between the surrogate and themselves.

After about a month, however, Side stopped paying their surrogate. When they reached out, they said she gave numerous excuses then stopped responding.

"It's very sad. It's disheartening, because she was a two-time surrogate," Palladino said.

When Palladino posted about her experience in a surrogacy support group for parents on Facebook, they discovered she had done the same to several other families. Twenty-three of them are now seeking to join a lawsuit against Side to recoup their funds.

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"My message to them is don't give up hope. Where money is spent, it is spent on something, whether it be an asset, whether it be property, whether it be an investment," the families' attorney Marianne Roback said. "Those funds can be traced and will be traced and once they are traced and put into a constructive trust for the benefit of the creditors, they can be reverted back into a recovery for them."

Attorneys said Side used more than $6 million in escrow funds from the families to bankroll her aspiring rap career, produce a music video and finance a music studio – which is now for sale.

"She did this knowing what we go through. It's not an easy process and what's coming out is just – I never would have thought," Palladino said.

In the suit, they also said she spent the money on lavish vacations, designer clothing and luxury vehicles. She was supposed to be in federal court in Houston on Wednesday as part of a hearing for the lawsuit, but never showed up.

The judge granted a temporary injunction to freeze Side’s bank accounts and assets. The FBI believes there are hundreds of victims, so they've created a website and form for potential victims to fill out.

As for the Palladino's, they have found another escrow service to pay their surrogate, but they're still trying to recoup their funds. Their baby boy is due in February.

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