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Director of Nonprofit that Locked Up Thousands of Immigrant Children Resigns Amid Federal Investigation

by Douglas Ankney

Juan Sanchez spent 32 years at the helm of Southwest Key Programs (SKP), a private contractor that operates shelters for the federal Office of Refugee Resettlement (ORR), which has custody of unaccompanied migrant children apprehended by Immigration and Customs Enforcement (ICE), as well as the children of immigrants detained by ICE while their asylum requests are processed.

As of February 2019, more than 11,000 immigrant minors, ranging in age from a few months to 17 years, were in ORR custody, held in shelters at about 100 different sites. SKP has bedspace to house nearly half of that population – up to 5,000 children – in the 24 shelters it operates for ORR in Texas, Arizona and California. In 2018 the firm received nearly $500 million from ORR, more than any other shelter operator, placing it at the center of a national debate over President Trump’s policy of forcibly removing immigrant children from their parents and detaining them in separate facilities.

At the height of the controversy in 2018, state inspectors found 246 violations at SKP shelters, including employees who were drunk on the job, rotten food and shampoo dispensers filled with hand sanitizer. At Casa Padre – a former Walmart store converted into a shelter run by SKP – U.S. Senator Jeff Merkley was refused admittance.

The scrutiny led to allegations of financial improprieties at SKP. With 8,000 employees and annual gross revenue of more than $400 million, the company – which is a registered nonprofit – was sitting on over $61 million in cash as of fall 2017. SKP does not own its facilities but rather leases them from real estate investors, two of whom were top executives at the firm. The U.S. Department of Health and Human Services (HHS), which oversees immigrant shelter grants, said forensic accountants were reviewing SKP’s finances.

Sanchez resigned from SKP in March 2019, a month after the resignation of chief financial officer Melody Chung. Jennifer Nelson, Sanchez’s wife, retains a top executive position at the firm. According to its most recently available tax return, SKP paid Sanchez $1.5 million in 2017. His wife received another half-million, while Chung was paid $1 million. 

Sanchez and Chung are also two of the landlords who lease shelter facilities to SKP. Asked about potential self-dealing by the New York Times, both executives vowed to sell their interests in the leased property. In his resignation email sent to SKP employees, Sanchez said he “can no longer bear” the “unfair criticism” leveled against him. Chung’s resignation letter wished that “the Lord [would] continue to bless the company abundantly.”

For at least three Guatemalan children separated from their parents and sent hundreds, sometimes more than a thousand miles away, the shelters have proved not a blessing but fatal. At an SKP-run facility near Brownsville, Texas, a 16-year-old whose identity has not been released died in April 2019, according to HHS spokesperson Evelyn Stauffer.

The teenager developed symptoms after arriving at the shelter on April 20, 2019, and was transferred to a local hospital, Stauffer said. Treated and returned to the shelter the same day, the child did not improve, was sent back to the hospital several days later and died due to undisclosed causes on April 30.

That death followed those of Jakelin Caal Maquin, 7, and Felipe Alonzo-Gomez, 8, in December 2018. Jakelin and her father had been apprehended with a group of other undocumented immigrants near the southern U.S. border in New Mexico. Felipe was taken into custody close to El Paso.

In October 2018, SKP shuttered its Hacienda del Sol facility near Youngstown, Arizona, days after the release of a blurry video that appeared to show the company’s staff pushing one child and dragging another. In January 2019, the Maricopa County Sheriff’s Office announced it had completed an investigation into the incident without finding sufficient evidence to press charges for criminal child abuse.

However, when interviewed for the New York Times, many detained children reported seeing or being subjected to physical abuse, leaving them with nightmares and reluctant to talk about their ordeal. 

“I don’t want to remember,” said one 10-year-old, who nevertheless recounted watching a kindergartner being injected with something after misbehaving in class. 

The kindergartner’s father had recently been deported, and it overwhelmed the child. The 10-year-old said he feared being injected, too. All the children who were interviewed stated they lived in fear of punishment at the shelters.

One 11-year-old boy from Guatemala, who spent six weeks at a shelter in Chicago operated by another nonprofit called Heartland Alliance, said he had to ask permission to hug his sister. At a shelter where an 8-year-old girl named Sandy was confined for two months, boys and girls were kept separate and punished if they went near each other. The day after Sandy was reunited with her mother, at a party thrown for her, Sandy reportedly began screaming and crying and shoved a toddler who tried to give her a hug and kiss, shouting for the boy to stay away. 

According to Dr. Colleen Kraft, president of the American Academy of Pediatrics, the longer a child remains in government custody and separated from their parents, the greater the potential for emotional and physical trauma. 

“The foundational relationship between a parent and child,” she said, “is what sets the stage for that child’s brain development, for their learning, for their child health, for their adult health. And you could have the nicest facility with the nicest equipment and toys and games, but if you don’t have that parent, if you don’t have that caring adult that can buffer the stress these kids feel, then you’re taking away the basic science of what we know helps pediatrics.”

In February 2019, activist Patricia Okoumou scaled the outside of SKP’s office building in East Austin, Texas while chanting, “Free the children. Let them go.” 

After a hospital examination, police said she would be charged with trespassing and booked into jail. 



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