Minnesota Woman Pleads Guilty to Fraud Scheme Involving Baby Shop Businesses
A woman from Sartell, Minnesota, has admitted to orchestrating a fraudulent scheme that netted her $9 million in financing for her baby product businesses.
Adelle Starin, 40, entered a guilty plea in U.S. District Court on December 19 to one count of wire fraud. According to court records, she carried out a scheme using fictitious companies to unlawfully secure funds between 2022 and November 2024.
Background in Business
Starin founded Baby’s on Broadway in 2013, a business specializing in baby products and toys. The company operated both online and through retail locations in Little Falls and St. Cloud.
The Initial Scheme
The U.S. Attorney’s Office for Minnesota revealed that Starin’s initial fraudulent activities involved submitting claims to TRICARE, a healthcare program under the U.S. Department of Defense.
Court documents state that she sought reimbursements for medical equipment that was not eligible under TRICARE guidelines. While some claims were initially approved, the scheme was eventually uncovered, and TRICARE ceased payments.
Transition to Loan Fraud
After losing the income from her TRICARE claims, Starin allegedly turned to lenders to maintain her cash flow. She created a shell company called Sunshine Medical, which she used to apply for loans, claiming the funds were needed to purchase inventory for Baby’s on Broadway.
Prosecutors say Sunshine Medical had no actual business operations or revenue.
Between April and October 2024, Starin reportedly submitted fraudulent invoices to Liquid Capital Enterprises Corp., securing approximately $1.1 million. Similarly, from February to October 2024, she sent fake invoices to Slope Tech Inc., obtaining nearly $8 million in financing.
Legal Consequences
Starin now faces the possibility of up to 20 years in prison for wire fraud. A sentencing hearing has yet to be scheduled.
Federal prosecutors emphasized the serious nature of the offense, noting the significant financial impact on the lenders involved. This case underscores the importance of vigilance in financial transactions to prevent and detect fraudulent activities.
No further comments were provided by representatives for Starin or the affected companies.