A former Hilmar resident has pleaded guilty to concocting a scheme that defrauded $2 million from prospective parents through her Modesto-based surrogate agency.

Tonya Ann Collins, 37, entered her guilty plea Tuesday in federal court to four counts of wire fraud connected to Surrogenesis USA Inc. and the Michael Charles Independent Financial Holding Group.

Surrogenesis was a surrogate and egg donation agency that marketed itself as assisting individuals in having children through third-party assisted reproduction. Michael Charles Independent Financial purported to be an independent personal property escrow company that would hold clients’ funds in trust and pay out those funds upon the clients’ authorization for legitimate expenses associated with the surrogacy process, such as surrogacy fees and medical costs.

From November 2006 to March 2009, Collins was the owner of both agencies. She admitted in her plea agreement that she steered Surrogenesis clients to Michael Charles Independent Financial but concealed her ownership and operation of the escrow company, including creating fictitious employee identities to make it appear that Michael Charles was an independent company with its own staff, according to court records.

According to the plea agreement, Collins used the Surrogenesis and Michael Charles accounts for unauthorized personal purchases of automobiles, homes, jewelry, clothing, and vacations for herself and others, without the clients’ knowledge or consent.

Collins also used client trust funds in the Michael Charles accounts to directly pay for her personal purchases and also transferred client funds from the Michael Charles accounts to other bank accounts that she controlled before spending the funds.

“Clients of Surrogenesis and Michael Charles Independent Financial confidently entrusted large sums of money in trust, believing that the expenses related to expanding their family would be paid,” said Herbert M. Brown, director in charge of the Sacramento Division of the Federal Bureau of Investigation. “Unfortunately, Tonya Collins’ greed has forever tarnished what should be happy memories of the arrival of children and the financial well being of her victims.”

As a result of Collins’ conduct, Surrogenesis and Michael Charles Independent Financial suffered substantial cash flow problems and various surrogate mother fees and related surrogacy expenses were not paid by the companies as required. Collins nonetheless continued to solicit new surrogate parent clients and funds. As a result, Surrogenesis and Michael Charles clients, surrogates, and financial institutions suffered losses of more than $2 million, according to the U.S. Attorney’s Office.

 “Tanya Collins cruelly took advantage of clients who sought nothing more than to bring children into the world. Her greed left a trail of devastation, both financial and emotional, in its wake,” said U.S. Attorney Benjamin Wagner.

Collins was originally charged with seven counts of wire fraud, four counts of mail fraud, nine counts of bank fraud, and 10 counts of money laundering. She is scheduled to be sentenced May 13 in federal court.