Netherlands court rules on cord blood stem cell fraud case

A man from the Netherlands has been convicted of fraud after misleading parents into paying him to store their children's biological material, despite lacking legal authorisation.

After establishing the foundation 'Navelsnoer Bloedbank' (Umbilical Cord Blood Bank) in 2013, the man convinced 21 parents to pay to store their children's umbilical cord blood, tissue or baby teeth, claiming that stem cells within these materials could be used for treatment of future diseases. Despite being denied authorisation by the Minister of Health, Welfare and Sport, he continued to collect and store bodily material without approval. The man was convicted of fraud, and the stored material destroyed.

'The reports, victim statements, and submitted claims for compensation show that medical hopes and raised expectations were, in many cases, decisive factors in the victims' decisions to entrust umbilical cord blood, a portion of the umbilical cord, or their children's baby teeth to the man for storage, in exchange for payment,' the Gelderland Court in Arnhem, the Netherlands, said in a press release, translated from Dutch. 'In many cases, experiences with (hereditary) serious illnesses within the family were the motivation'.

The man provided 'misleading information' to persuade victims to pay for storage and convinced clients that he was operating from a legitimate medical facility for stem cell storage, using professional-looking websites and referring to international regulations in the storage terms and conditions.

The court found that the man's websites and communications with the victims 'falsely gave the impression that umbilical cord blood, cord tissue, or baby teeth could be stored for use in a potential future treatment of a serious illness in a child or another family member.'

While he attempted to get the necessary official recognition in 2013 and 2014, the man was denied for not meeting legal requirements. All bodily material ultimately had to be destroyed as, without the correct certification, the quality of the storage could not be guaranteed.

The court imposed a six-month suspended prison sentence and the maximum 240 hours of community service. The severity of the sentence was reduced because of the time elapsed since the offences, which took place between 2013 and 2017, and a professional ban was deemed unnecessary as the man no longer works in the sector. He was also ordered to repay over €25,000 to 20 of the victims for the storage payments.

This case comes amid wider contentions surrounding private companies offering cord blood and baby teeth stem cell banking. The extent of the benefits of banking for autologous (self-use) stem-cell treatment remain contested, with claims that industry marketing overstates its value (see BioNews 1249 and 1303).

These concerns do not apply to public cord blood donations, such as those made through NHS facilities, which provide allogeneic (donated for use by others) stem-cell treatment to patients with life-threatening conditions, including certain cancers and immune deficiencies.