The largest-ever crackdown on 'birth tourism' businesses that help Chinese women travel to the United States to deliver 'anchor babies' has resulted in twenty arrests.
Three people - Dongyuan Li, 41, Michael Wei Yueh Liu, 53, and Jing Dong, 42, were arrested in Southern California on charges including conspiracy, visa fraud and money laundering.
More than a dozen others, among them Li's business partner Chao Chen, have also been charged in cases stemming from three so-called birth tourism businesses.
Many of the suspects believed to be currently living in China, and the crackdown marks the first time the United States has criminally prosecuted birth tourism operators, said the U.S. attorney's office.
The businesses - which were raided by federal agents in March 2015 - billed pregnant Chinese women tens of thousands of dollars - and some as much as $100,000 - to travel to California to deliver their babies in American hospitals so the children would automatically obtain U.S. citizenship, prosecutors said.
It isn't illegal to visit the United States while pregnant but authorities said the businesses, with names like You Win USA Vacation Servbices, Star Baby Care and USA Happy Baby, touted the benefits of having American citizen babies and had women hide their pregnancies while seeking travel visas and lie about their planned trips.
One maternity tourism company allegedly coached clients to tell consular officials they planned to stay at Trump International Hotel in Honolulu when really they would spend three months at an apartment in Irvine, California to give birth.
U.S. authorities said the businesses not only engaged in fraud but have created a national security risk.
Their customers - some who work for the Chinese government - have secured American citizenship for children who can later move back to the United States, and once they're 21 years old, sponsor their parents for green cards.
'I see this as a grave national security concern and vulnerability,' said Mark Zito, assistant special agent-in-charge of Immigration and Customs Enforcement's homeland security investigations in Los Angeles.
'Are some of them doing it for security because the United States is more stable? Absolutely. But will those governments take advantage of this? Yes, they will.'
The phenomenon of birth tourism is nothing new. The businesses have long operated in California and other states and cater to well-to-do couples from China, Russia, Nigeria and Turkey.
In the past, birth tourism operators sometimes ran into trouble with local code enforcement officials when neighbors in residential areas complained about crowding or excess trash, but they didn't face federal scrutiny.
In 2015, federal agents raided roughly three dozen sites connected with birth tourism in Los Angeles, Orange and San Bernardino counties.
More than 20 people were designated material witnesses to the cases but some later fled back to China and were charged with violating federal court orders, and an immigration lawyer who helped them leave the country was convicted of obstruction of justice.
This week, a federal grand jury indicted four people who were accused of running the three birth tourism businesses until the 2015 stings.
The company You Win USA dated at least to 2010 but advertised having brought 8,000 women to the United States - half of them from China - since it claimed to have been started in 1999.
Federal officials said each company brought hundreds of customers to give birth in the United States.
In one of the cases, authorities outlined in court filings how wealthy Chinese couples paid You Win USA between $40,000 and $80,000 to travel to apartments in Irvine, California, to deliver their babies.
In one instance, a couple paid the indigent rate for hospital bills - a total of $4,080 - even though they had more than $225,000 in a US bank account they had used to shop at luxury stores including Louis Vuitton and Rolex.
The San Diego Union-Tribune reported that Li, an executive at You Win USA, was paid $1.5million in wire transfers from China in 2013 and 2014, which enabled her to buy a house in Irvine for $2.1million and a $118,000 Mercedes Benz, according to her indictment.
During the investigation, federal authorities seized Li's home, six cars, more than $1million from banks accounts, as well as gold bars and coins.