[THEMARSHALLPROJECT.ORG] The Marshall Project and NPR have found that in at least 49 states* and Washington, D.C., foster care agencies comb through their case files to find kids entitled to these benefits, then apply to Social Security to become each child’s financial representative, a process permitted by federal regulations. Once approved, the agencies take the money, almost always without notifying the children, their loved ones or lawyers.At least 10 state foster care agencies hire for-profit companies to obtain millions of dollars in Social Security benefits intended for the most vulnerable children in their care each year, according to a review of hundreds of pages of contract documents. A private firm that Alaska used while Hunter was in state care referred to acquiring benefits from people with disabilities as “a major line of business” in company records.
Some states also take veterans’ benefits from children with a parent who died in the military, though this has become less common as casualties have declined since the Iraq War.
State foster care agencies collected more than $165 million from these children in 2018 alone, according to the most recent survey data from the research group Child Trends. And the number is likely much higher, according to Social Security Administration data for 10 states obtained by a member of Congress and shared with The Marshall Project and NPR.
In New York, California and a handful of other states, foster care is run by counties, many of which also take this money, our reporting shows.
Nationwide, foster care agencies are funded through a complicated web of federal and state grants and subsidies, paid for by taxpayers. Children’s Social Security benefits were not intended to be one of those funding streams, according to federal law.
In a Marshall Project/NPR survey of all 50 state child services agencies, most pointed out that it is legal for them to apply to the Social Security Administration to become the financial representative for foster children’s benefits — though federal regulations state that a parent, foster parent, relative or family friend is preferred. Almost all said they take kids’ money as reimbursement for the cost of foster care, putting the funds in individual accounts to recoup what the state has paid for each child’s room and board.
In interviews, several officials also said that children in foster care are not mature enough to make good financial choices on their own, and that their family members or foster parents may have ill intentions and pocket the cash themselves.