Three Fertility Clinic Doctors Indicted

SANTA ANA — Three former UC Irvine fertility doctors, already charged with mail fraud in the university’s fertility scandal, have been indicted on charges of income tax evasion, officials said Friday.

A federal grand jury indictment alleges that Drs. Ricardo Asch, Jose P. Balmaceda and Sergio C. Stone essentially hid patients’ cash payments from their books and filed fraudulent business and personal income tax returns with the U.S. Internal Revenue Service for 1991 and 1992.

The indictment is the latest development in a scandal that has plagued the university’s once-prestigious but now-defunct Center for Reproductive Health. The university and former patients have accused the doctors of stealing human eggs and embryos and transplanting them into other women. The UC system has also accused the doctors of research and financial improprieties.

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About 90 lawsuits have been filed against the doctors, who have repeatedly denied the allegations against them.

The criminal case against the doctors had been restricted to mail fraud--previously 35 counts that were consolidated to 20 in the latest indictment. The new indictment added one count of conspiracy against all three, and two counts each of income tax evasion.

The conspiracy count charges that the doctors “took steps to conceal from the IRS cash payments received from [Center for Reproductive Health] patients” by having the clerical staff record each transaction as an “adjustment” rather than a payment. It does not state how much cash was involved.

The cash was collected in an envelope, and at the end of each month the doctors would “divide up the cash income that had been kept off the partnership books,” the indictment states.

An attorney for Stone--the only one of the three physicians who has remained in the United States to face charges--called the new charges “an accounting matter.”

Stone signed his income tax returns without knowing that the cash was not being reported, lawyer John D. Barnett said. He added that the office staff put the cash in an envelope “to keep it separate, so it would not get stolen. . . . There is nothing sinister about it.”