Fugitive Doctor in Fertility Clinic Scandal Held in Argentina

A doctor fleeing fraud charges stemming from the 1994 scandal at UC Irvine’s now-defunct fertility clinic was captured this week as he tried to slip into Argentina, U.S. officials said Friday.

Dr. Jose Balmaceda, 53, who had eluded federal agents monitoring his activities for more than two years, was arrested Thursday after customs officials at Buenos Aires Airport recognized him as a fugitive, authorities said.

Balmaceda fled to his native Chile in 1995 at the height of the scandal, which began when a whistle-blower accused three physicians who ran the clinic of underreporting income.

It soon drew national attention when allegations emerged that the doctors had harvested eggs from women undergoing fertility treatments in four Southern California medical facilities from the late 1980s through the early 1990s, implanting some eggs in other women and funneling others into research.

Some couples bore children conceived from the eggs of other women without the knowledge of the biological parents, investigators said. UC Irvine officials accused the three doctors of stealing eggs and embryos from at least 70 patients.

Balmaceda, former head of the once-internationally acclaimed fertility practice, probably will be returned to Orange County and face prosecution on mail fraud charges by year’s end, said John Hueston, chief of the Santa Ana office of the U.S. attorney’s office.

A federal grand jury in 1996 indicted Balmaceda and a partner, Dr. Ricardo Asch, on 30 counts of mail fraud. The two doctors allegedly created false reports in a scheme to bilk medical insurance companies for fertility treatments that were not covered.

The third doctor who ran the clinic, Sergio Stone, was convicted in 1997 of fraudulently billing insurance companies. He was fined $50,000 and ordered to serve one year of home detention. The University of California Board of Regents fired Stone last year.

“Dr. Balmaceda was one of the ringleaders in the fraud that shocked Orange County,” Hueston said. “Our office is gratified that the long efforts of the FBI and others . . . have paid off.”

The arrest was applauded Friday by Melanie R. Blum, an attorney who has represented dozens of families in litigation against the fertility clinic and its doctors.

“It’s a surprise, because I really believed that our federal government had lost interest in bringing them back,” Blum said.

“It’s finally coming full circle. I think a lot of the families will be interested in seeing some justice done. They felt a little cheated that the doctors walked away and didn’t face anything.”

Stone, the only doctor who has been tried in connection with the scandal, said he sympathizes with Balmaceda’s family but is pleased that his former partner is finally in custody.

“I’m sorry for him, but he needs to be responsible,” Stone said. Federal prosecutors are continuing to push for the return of Asch, who they believe is living in Mexico City and running a fertility clinic there. Officials are preparing to file papers asking for the doctor’s extradition, Hueston said.

The effort to return Balmaceda and Asch to Orange County has been a tortuous one, partly because neither is a U.S. citizen and partly because they settled in countries from which extradition is difficult.

Believing it unlikely they could win Balmaceda’s return from Chile, FBI agents spent the last two years keeping tabs on him, hoping they could catch him if he left that country, Hueston said.

Agents traveled to a number of conferences they expected him to attend. On each occasion the doctor failed to appear--until Thursday.