Surrogacy Agency Failures: Warning Signs Every Parent Should Know

In December 2025, the FBI opened an investigation into a surrogacy agency in Washington state. Around 150 families may have had funds tied up in the agency's in-house system — individual losses ranging from roughly $40,000 to more than $66,000. That case followed a Texas-based surrogacy escrow company that collapsed in mid-2024, with alleged losses totaling more than $16 million across an estimated 800 or more families.

We are not writing this to alarm you. We are writing it because these events are documented, and because intended parents deserve a clear account of what went wrong — and what real structural protections actually look like. At Delivering Dreams, we have spoken with families who came to us after difficult experiences elsewhere. Their first question is almost always the same: how do I know this won't happen to us?

This article covers the patterns behind recent agency failures, what those patterns reveal about structural risk, and how our programs are built to address them. We will also tell you what questions to ask any agency — including us.

Surrogacy Agency Failures: A Pattern, Not Just Bad Luck

The cases that surfaced between 2024 and 2025 were not random. They shared a recognizable structure — one that, in hindsight, was visible before the crisis became public.

In the Washington state case, the agency's founder had apparently discouraged clients from using third-party escrow — the independent fund management approach that many industry professionals recommend. She told clients their funds were held separately at an FDIC-insured bank. When the agency announced it was ceasing operations due to having "no liquid capital," families had no independent escrow provider to turn to, no record access, and no recourse outside of law enforcement and civil litigation.

In the Texas escrow case the prior year, a company that marketed itself as a trusted financial intermediary for surrogacy families allegedly misappropriated millions of dollars in client funds. The FBI launched a criminal fraud investigation. Families who had placed large sums into accounts found the money gone.

Neither case had obvious warning signs in its public profile. Both presented professionally. The failure point in each case was structural — not cosmetic. Understanding the structure is the only reliable protection.

The Three Most Common Failure Points

Looking across documented cases, three structural vulnerabilities appear most consistently.

Large upfront payments with no milestone accountability

When families pay a substantial portion of their program fees upfront — before key stages have been completed — they are exposed to the agency's financial health in a way that staged payment structures avoid. In the cases that failed, families had transferred large sums early in their journey. When operations ceased, those funds were effectively unrecoverable in the short term, regardless of what the contract said.

Inadequate legal documentation, particularly for international families

In international surrogacy, legal parentage must be established across two jurisdictions: the country where the birth occurs, and the intended parents' home country. If an agency collapses before documentation is complete — or if the documentation was not structured correctly from the start — the consequences can take years to resolve. For families from Germany, Israel, or the UK, where domestic recognition of international surrogacy involves specific legal requirements, the risk is compounded. It is not a theoretical concern. It has affected real families in recent years.

Communication breakdown as an early warning signal

In nearly every documented case, slow or evasive communication preceded the formal crisis by weeks or months. Vague answers about payment status. Delayed responses. Questions about legal timelines met with reassurance rather than documentation. For families already emotionally invested in their journey, these signals were easy to rationalize. In hindsight, they were consistent leading indicators — not coincidences.

How Payment Structure Creates — or Limits — Your Risk

The financial risk in surrogacy is not simply about whether an agency is honest. It is also about how much money you have transferred, and at what point, if something goes wrong.

In both major 2024–2025 cases, families had paid large amounts early in their journey. Some had paid most or all of their program fees before a surrogate had even been matched. When operations ceased, they had little leverage and no independent fund custodian to petition.

A milestone-based payment structure addresses this risk differently. Rather than transferring a large sum upfront, you pay at defined stages — as specific, verifiable events occur in your journey. This means your financial exposure at any given point corresponds to work actually completed. If something goes wrong early, you have not already paid for the entire program.

Milestone-based payment and independent escrow are two different approaches to the same underlying concern: limiting your exposure if an agency encounters difficulties. When evaluating any agency, the question to ask is not only "who holds my money" — it is also "how much money am I being asked to transfer before each stage is complete, and what happens if it isn't completed?"

The Legal Gaps That Leave International Families Most Exposed

For intended parents based in Germany, Israel, the UK, or any country where domestic surrogacy law is complex, the legal risk in international surrogacy extends beyond the country where the birth occurs.

Parentage recognition — the legal process of establishing you as the child's parent in your home country — depends on documentation generated at and after the birth. If that documentation was not structured correctly from the start, or if it is incomplete when you need it, the process of correcting the situation in your home country can be slow and expensive.

Germany presents one of the most complex cases. German law does not automatically recognize surrogacy-established parentage from abroad. The legal pathway requires specific coordination, and families are strongly advised to consult a German family law attorney before beginning a surrogacy journey — not after. Israel requires government approval for international surrogacy before the process begins, a prerequisite that must be built into planning from day one. UK families must apply for a parental order after birth, a process that depends on documentation originated in Ukraine being correctly structured.

An agency that handles legal documentation in the country of birth — but has limited experience with parentage recognition in your home country — may not flag these requirements until you are already mid-journey. It is worth asking any agency directly: have you worked with families from my specific country before, and can you describe the home-country legal process in detail? If the answer is vague, that is useful information.

You can learn more about how the surrogacy process works step by step, including the legal stages involved at each milestone.

Professional Memberships: One Verifiable Signal Among Several

Membership in a professional organization does not guarantee a positive outcome. But it does indicate that an agency has been reviewed against a defined set of standards — and that it has chosen to operate within a framework that can be audited and revoked.

Delivering Dreams is a member of the American Society for Reproductive Medicine (ASRM), the primary medical and ethical authority for reproductive medicine in the United States. ASRM publishes clinical guidelines covering surrogate screening, medical protocols, and the ethical treatment of all parties throughout the surrogacy process. Their Ethics Committee has published dedicated guidance affirming that surrogates retain full medical autonomy and must not face financial pressure from agencies when making medical decisions — a standard that applies regardless of the country in which care is provided. Current ASRM practice guidelines are available here.

We are also a member of RESOLVE: The National Infertility Association, a patient advocacy organization that provides resources and support to people navigating infertility and family-building options. Additionally, Delivering Dreams is a verified provider in the Surrogacy Network and the Global Fertility Network (OVU) — two independent directories that screen agencies before granting verified status.

We mention this not as a substitute for the structural questions covered elsewhere in this article, but as one additional layer of accountability. Any agency you are considering should be able to tell you clearly which professional organizations it belongs to and what those memberships require of it.

"But They Had Good Reviews" — Why Social Proof Is Not Enough

This may be the hardest point in this article. Several of the agencies that failed most publicly had strong reputations. Some had been operating for more than a decade. They had positive testimonials, professional websites, and founders who were personally trusted by their clients.

One client of the Washington state agency, interviewed by NBC News shortly after the collapse, described calling the founder's cellphone directly when she had questions and receiving a response. The personal relationship made the subsequent events all the more devastating. The full NBC News investigation is available here.

Reviews reflect completed journeys. They do not reveal the payment structure of the agency, whether pricing is fixed or subject to change, whether communication will hold up under pressure, or whether the legal team has documented experience with your home country's parentage process. Social proof is a lagging indicator. By the time negative reviews appear in meaningful numbers, the agency is often already in crisis.

The questions that give you more reliable information:

• How is payment structured — what do I pay, and at which specific milestones?
• Are all costs fixed at the time of signing, and what happens if any costs increase?
• What happens to my journey — practically, step by step — if the agency cannot continue operating?
• Have you worked with families from my specific country before, and can you describe the home-country legal process in detail?
• Who is my named coordinator, and what is the expected response time?

These are not hostile questions. A well-structured agency will welcome them. An agency that becomes defensive or vague in response to direct financial and legal questions is giving you useful information.

You may also find it helpful to review real surrogacy success stories from families who have completed journeys with us, and to read frequently asked questions about surrogacy that address common concerns about agency selection.

A Structural Comparison: What to Ask vs. What We Do

The table below reflects questions we believe every intended parent should ask any agency — including us. We have answered each one from our own program structure. We encourage you to ask any other agency you are considering the same questions and compare the answers directly.

For a detailed breakdown of how surrogacy fees are structured and what is included in each program, our costs page provides a full overview by program type. You can also use our free surrogacy cost calculator to estimate the investment range for your specific situation.

If You're Already With an Agency You're Uncertain About

If you are currently working with an agency and something doesn't feel right — communication has slowed, questions about payments are being deflected, or you're receiving reassurance where you expected documentation — you are not obligated to continue.

A few steps that may help clarify your situation:

• Request a written statement of your payment status. How much have you paid, against which milestones, and what remains? A legitimate agency will provide this without hesitation.
• Ask for the current status of your surrogate's compensation and health monitoring. If an agency is under financial pressure, surrogate payments are often among the first things affected.
• Clarify the status of your embryos. Your embryos are stored at a medical facility. Contact that facility directly to confirm they are accessible to you, regardless of your agency relationship.
• Consult an independent reproductive attorney in your home country about your contract, your documentation status, and your options.

If you're not sure what questions you're entitled to ask, we're happy to have a conversation — with no obligation — about what a well-structured surrogacy agreement should contain.

How Delivering Dreams Is Structured to Support You

Delivering Dreams is an American-owned surrogacy agency with offices in New Jersey, Boston, Lviv, and Kyiv. Our programs operate primarily in Ukraine. For families who face eligibility barriers in Ukraine — including single intended fathers and same-sex couples — we also offer our Ghana–Ukraine hybrid program, which provides an alternative legal pathway without compromising on clinical standards.

Here is how our program works in practice:

• Milestone-based payment. You pay at defined stages as specific events in your journey are completed. All costs are fixed at the time of signing — our pricing is guaranteed not to increase. If any costs rise, we pay the difference.
• Doctor-centered medical approach. We work with specific physicians we trust, and we contract with their current institution. If a physician moves to a different facility, we follow that doctor — because our commitment is to the quality of your care, not to an institution. All medical communication is coordinated through your named case manager.
• Full legal support in Ukraine. Legal documentation throughout your journey in Ukraine is included: contract preparation, your surrogacy agreement, and a complete exit document package for your embassy. Your surrogate signs her contract with the intended parents directly, through a power of attorney issued to an agency representative.
• All surrogate payments managed by the agency. You have no separate financial relationship with your surrogate. Compensation, medical expenses, and support payments are all handled by us — clearly itemized in your agreement from the start.
• Home-country parentage guidance. We handle the Ukrainian legal process completely. For parentage recognition in your home country, we can provide guidance and referrals where we have them. We will tell you clearly, before you sign, what that process involves and who you will need to engage — so there are no surprises after the birth.
• Named coordinator throughout. Every family has a dedicated coordinator. You will know who to contact, what is happening at each stage, and what to expect next.
• Program guarantees. Our program guarantees cover legal compliance, transparent and fixed pricing, PGD-informed program selection, rigorous surrogate screening, immediate matching, comprehensive surrogate support, and your full parental rights — including your names on the birth certificate with no mention of a surrogate. We encourage you to read the guarantees page in full before your consultation.

We understand that trust in this process has been damaged for many families by recent events. We don't ask you to take our word for it — we ask you to put the same questions to us that you would ask any agency, and we will answer them directly. You can explore why families choose Delivering Dreams and review our full range of surrogacy programs before deciding whether to speak with us.

For families beginning their research, our Ukraine surrogacy pricing page provides a transparent overview of costs. Our surrogacy timeline estimator can help you understand what a realistic journey looks like from first consultation to the birth of your child.