Thousands of children in the UK are being placed in unregistered and illegal children's homes, with councils spending an estimated £353 million annually on these inadequate facilities. These homes, which can range from caravans and holiday rentals to ordinary houses, are often unsafe and provide substandard care, leaving vulnerable children exposed to severe risks including sexual predators and grooming by criminal gangs.
In a landmark prosecution, the first of its kind, Catalyst Care owners Davidson Lynch-Shyllon and Miriam Ekhator were fined a total of £92,400 for running illicit children’s homes. The company, which Lynch-Shyllon co-owns, earned nearly £1.8 million over three years for looking after nine youngsters in care, despite operating illegally. The firm's annual turnover rose fivefold to nearly £1 million, though officials were unclear how the funds were spent, while the owners pocketed £386,000 in dividends. Officials were mystified over how this funding was spent, while the owners pocketed £386,000 in dividends. Davidson Lynch-Shyllon, a music producer, and Miriam Ekhator have been barred from running homes.
Children placed in these unregistered settings often suffer severe trauma and neglect. One 15-year-old girl was sexually assaulted by her "carers" after being plied with alcohol and cocaine in a three-bedroom unregistered home near Durham. She had been placed in care to escape sexual exploitation. In another case, a 17-year-old girl spent 14 months in an illicit home with broken windows and fake fire alarms, where she did not attend school and was isolated.
Experts and charities have raised alarms about the scale of the problem. The use of illegal homes has surged in recent years, despite placements costing up to £40,000 a week in challenging cases. A report by the all-party Public Accounts Committee found that 800 young people were sent to illegal homes last year for an average of six months, contrary to claims that they are used only as temporary measures.
Sir Martyn Oliver, Ofsted's chief inspector, stated that the issue is not a lack of available places in legal homes, but rather ensuring that registered providers offer care for children who need it most. He noted that the number of registered children's homes has increased, but the problem persists with unregistered facilities.
Concerns have also been raised about the infiltration of these homes by organized crime groups. A study by Anglia Ruskin University revealed that an unregistered home was compromised by a criminal group, with one member even working as a counselor. Some of these properties have been described as closer to "trap houses" than care settings, with children going missing for days.
Children's Commissioner for England, Dame Rachel de Souza, has campaigned against these illegal providers, stating that vulnerable children are sleeping in unsafe, illegal settings, cared for by unqualified individuals. She welcomed Ofsted's prosecution, hoping it signals the beginning of the end for providers who prioritize profit over child safety. Councils acknowledge the issue, with Medway Council stating that fewer than five young people were placed with Catalyst Care and that illegal homes represent a national problem. Kent County Council indicated that using such providers is a last resort and that they are developing their own council-run homes.
More than one in four people in prison have spent time in care as children, highlighting the long-term consequences of failures within the state care system. Charities and former care leavers emphasize that children in care are often targeted by predators and gangs due to their vulnerability and the lack of adequate safeguarding in both legal and illegal settings.