A mother and child in Mexico in April as they and 600 others headed to the U.S. to seek asylum. (Photo: John Moore/Getty Images)

By Alex Kotch

The U.S. government has paid at least four private companies that have been accused of physical or sexual abuse, or discrimination, to help transport or house undocumented children from Central and South America, federal contracts show. One case was fatal.

Recent policy changes and statements by the administration have brought the government’s handling of these children into sharp focus.

On Saturday, President Trump erroneously tweeted, “Put pressure on the Democrats to end the horrible law that separates children from there [sic] parents once they cross the Border.” It was not immediately clear to which law President Trump was referring, but on May 7, Attorney General Jeff Sessions announced a new prosecution policy that could lead to the separation of virtually all undocumented families arriving with children.

“If you cross the border unlawfully, even a first offense, we’re going to prosecute you,” Sessions said. “If you’re smuggling a child, we’re going to prosecute you, and that child will be separated from you, probably, as required by law.”

The new policy ignited public interest in the fate of such children and in Senate testimony this April by the head of the Office of Refugee Resettlement (ORR), Steven Wagner, that in the final three months of 2017, the office was unable to locate nearly 1,500 undocumented children it had placed in private homes. Wagner said the agency is not legally responsible for the children once they’ve left an ORR shelter for foster care, adding that his office is “taking a fresh look at that question.”

ORR, part of the Department of Health and Human Services (HHS), contracts with public and private agencies and companies to shelter undocumented kids who entered the United States alone or who were separated from their parents by the Department of Homeland Security (DHS). Businesses contracted by ORR were identified in a TYT review of government spending data. Attempts to reach the businesses for comment were unsuccessful over the holiday weekend.

It’s unclear whether any of the ORR-funded companies dealt with children HHS has been unable to locate. The contractors that have been subject to complaints include three shelters and one company involved in transporting detained children. The companies have won contracts worth tens of millions of dollars. Complaints against them range from as far back as 2001 to as recently as this year.

The Shiloh Treatment Center of Manvel, Texas, received over $9.1 million in “unaccompanied alien children program” HHS contracts that began in February 2017 and conclude in January 2020. During the Obama Administration, Shiloh got a similar $16.6 million contract that ended in 2017.

Prior to these contracts, Texas officials documented a host of physical abuses by Shiloh staff. One child died in 2001 due to exertion from being restrained. ORR reportedly later found Shiloh to be “in compliance” with state requirements.  

(Shiloh’s owner, Clay Dean Hill, owned another company, Daystar Residential, where at least two children died. A 15-year-old girl died of asphyxiation in 2002 at Daystar, and the death was ruled a homicide. Another teen died in 2010 while being restrained inside a closet, and it was also ruled a homicide, after which Texas officials shut down Daystar. Hill told the Houston Chronicle he took the incidents seriously and sought to make improvements afterward.)

Another shelter business, International Educational Services (IES), is headquartered in Los Fresnos, Texas, roughly 15 miles from the Mexican border. IES operates a number of shelters in southern Texas and has received tens of millions of dollars worth of HHS grants, including a $9.3 million contract in April 2017 for the care and placement of undocumented children.

The company closed down two Los Fresnos shelters in March after HHS did not renew its funding for them. Neither the company nor HHS commented publicly on the decision at the time. However, The Monitor newspaper of Texas reported in March that, “during the past two years, the Texas Department of Health and Human Services has inspected the facilities 349 times and discovered a total of 116 deficiencies that include a range of inappropriate sexual behavior, lapses in foster care home oversight, problems with administering medical care and the improper punishment of children.” According to public records, HHS has revised all grant amounts to $0. It’s unclear whether this means these agreements were terminated. TYT was unable to reach IES for comment.

Allegations of child and employee abuse have been leveled against federally funded companies operating far from the border, as well.

In February 2017, the Shenandoah Valley Juvenile Center got two three-year contracts totaling $8 million to shelter undocumented kids in Virginia. It is reportedly one of two U.S. maximum security facilities that house unaccompanied, undocumented children. In October, child detainees filed a class-action lawsuit against the shelter alleging “brutal, inhumane conditions” and abuse. In another lawsuit, a former employee alleges that he was fired from Shenandoah because of his race. Executive Director Timothy Smith was unavailable for comment on Monday. Shenandoah officials previously told Frontline that the abuse allegations were “without merit” and they planned to “present evidence at trial that will allow a jury to reach the same conclusion.”

Virginia-based private security contractor MVM has received large payments from Immigration and Customs Enforcement (ICE) for transportation of “unaccompanied alien children” in Texas, including an ongoing $52 million contract. The contracts have come even as multiple lawsuits accuse the company of racial discrimination and sexual harassment of employees. In October, MVM had to pay a fine for racial and religious discrimination against a Muslim security guard. ICE told TYT that it “does not handle unaccompanied minor issues” and did not explain the contract.

According to the Arizona Daily Star, once an undocumented child is separated from their parents, the child is considered an “unaccompanied minor.” According to the ORR website, “The majority of unaccompanied alien children are cared for through a network of state licensed ORR-funded care providers, most of which are located close to areas where immigration officials apprehend large numbers of aliens.”

ORR states on its website, “HHS is engaging with state officials to address concerns they may have about the care or impact of unaccompanied alien children in their states, while making sure the children are treated humanely and consistent with the law as they go through immigration court proceedings that will determine whether they will be removed and repatriated, or qualify for some form of relief.”

It’s not clear how many children may have been or currently are in custody of private contractors with histories of complaints. ORR did not respond to questions by press time.

Alex Kotch is an award-winning investigative reporter whose work has appeared in The Nation, Vice.com, and International Business Times. Follow him on Twitter.

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