Rudy Rupak, founder of Planet Hospital, convicted on fraud charges

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Rudy Rupak, founder of Planet Hospital, convicted on fraud charges

U.S. District Court Judge Cynthia A. Bashant handed down a 24-month sentence on August 17 to Rudy Rupak, the founder of Planet Hollywood (PH). Initially a medical tourism company, about ten years ago, Planet Hospital branched out into international surrogacy.

Rupak had office locations based in San Diego, Calabasas, and Calexico.

Rupak, 49, defrauded dozens of intended parents around the world and crushed their dreams of starting a family. Rupak was found guilty of bribery, defrauding clients, and interstate wire fraud.

In addition to his two-year sentence, Judge Bashant fined Rupak $10,000 and set a restitution hearing for September 13.

According to court records, Rupak admits he is responsible for causing a loss of at least $247,000.

“The defendant betrayed the trust placed in him by people desperate to have a child. By preying on their vulnerable emotions, he was able to extract more money on the false promise that he was doing everything possible to help them obtain a baby. To use the dream of parenthood as leverage for obtaining fraudulent proceeds is intolerable and heartbreaking,” U.S. Attorney Alana Robinson said.

During the criminal trial, prosecutors claimed that Rupak initiated interstate wire transfers with the intent to take part in commercial bribery over the course of 16 months between 2012 and 2014.

“In furtherance of the scheme, he [Rupak] solicited, and instructed PH employees to solicit, medical tourism and international surrogacy clients by falsely claiming that their funds would be set aside in escrow accounts and used only to pay for medical services,” the Times of San Diego reported. “In some instances, Rupak arranged for funds obtained from new PH clients to be used to pay for services provided to existing PH clients, court documents state.”

Rupak also underestimated his surrogacy services fees to maximize the number of potential clients. They had no idea there would be additional charges later on.

“Today’s sentencing is justice overdue for the many victims affected by this defendant’s deceitful practices,” FBI Special Agent Eric S. Birnbaum said. “Acharyya [Rudy] Rupak can no longer prey upon those desperate to have a family.”