Care company fined for running illegal children's homes in legal first

Although the exact number of unregistered homes is unknown, Ofsted estimates there are around 900 illegal children's homes operating in England.

In 2024 a report by the Children's Commissioner for England found that, at any one time, hundreds of vulnerable children were placed in unregistered homes for an average of six months each.

Councils say that they are often forced to turn to unregistered children's homes because there are not enough registered homes in the right locations or homes that are willing to take children with very complex needs.

Ofsted said increased funding will help them identify and investigate unregistered providers and that new powers granted through the Children's Wellbeing and Schools Act will allow them to issue fines.

During the sentencing on Tuesday, Judge Sushil Kumar said it was of "great concern" that the defendants failed to register the homes despite receiving multiple warning letters.

Daisy Wrigley, for Ofsted, told the court the number of unregistered children's homes in the UK was not known, which "highlights the importance of registering".

Ofsted's chief inspector, Sir Martyn Oliver, said the prosecution "marks an important milestone in our efforts to tackle illegal children's homes and sends a clear message that operating outside the law will have consequences".

He added: "We are currently consulting on proposals to downgrade local authorities who commission these illegal homes."

Josh MacAlister, children and families minister who led a review into children's social care, called it a "welcome start to our wider crackdown".

"Vulnerable children deserve to be safe and properly cared for, and I want to see more action of this kind," he said.

Reacting to the prosecution, Children's Commissioner for England, Dame Rachel de Souza, said: "It is incomprehensible that this is happening in 2026 and prosecutions can't come too soon.

"I hope it represents the beginning of the end for the scandal of illegal providers who put profit above the safety of vulnerable children."

Additional reporting by Jemma Crew.