A company and its directors have been convicted and sentenced for operating unregistered children’s homes in Kent in a legal first.
Ofsted said its action against Catalyst Care Limited, which is based in Croydon, was the first time it had successfully prosecuted an organisation for operating unregistered homes, which is illegal.
The company, and its directors, Davidson Lynch-Shyllon and Miriam Ekathor, pleaded guilty to all charges at Croydon Magistrates’ Court on 9 March 2026, and were sentenced yesterday.
They were fined £92,400 for operating three unregistered homes in Kent between October 2022 and April 2025, through which they accommodated nine children. They were also ordered to pay £2,960 in victim surcharges – fees designed to fund services for victims – and costs of £17,250.
Lynch-Shyllon and Ekathor, who set up the company in August 2020, were also disqualified from carrying on and/or managing or having a financial interest in a children’s home.
Ofsted said the pair were repeatedly warned that they were breaking the law, yet they continued operating the homes, during which time they received £1.7m from placing authorities.
Following the sentencing, children’s minister Josh MacAlister said: “This case should send a clear signal to anyone running an illegal children’s home: the law will catch up with you and you will face consequences.”
Legal framework around unregistered homes
Children’s homes in England – defined as the provision of care and accommodation wholly or mainly for children – must be registered with Ofsted, under the Care Standards Act 2000 (section 1).
Section 11 of the 2000 act states that it is an offence to operate an establishment without registration, punishable by a potentially unlimited fine on a first offence.
Ofsted said that criminal prosecutions into illegal homes were complex and that the conviction of Catalyst Care Limited followed hundreds of warnings to other providers of unregistered settings.
Since July, under changes to the 2000 act brought about by the Children’s Wellbeing and Schools Act 2026, it has been able to impose monetary penalties on providers if it is satisfied, beyond reasonable doubt, that they are operating an unregistered home.
According to the government, this will be “much less resource intensive and costly than prosecution”, providing a “greater deterrent” against operating an illegal home.
Spike in use of unregistered children’s homes
The number of children placed in unregistered homes in England increased sevenfold from 2020-21 (147) to 2023-24 (982), according to 2024 Ofsted data, a trend widely attributed to an insufficiency of regulated placements.
At the time, the regulator said such homes were typically of “poor quality”, as evidenced by the fact that just 6% of unregistered settings applied to register with Ofsted after receiving a warning letter, with a mere 8% of these applications being approved.
Separate data collected by the Children’s Commissioner for England showed a fall in the number of children in unregistered placements, from 764 to 669, in the year to September 2025.
However, in a report published earlier this year, de Souza warned that too many children in care – many with high and complex needs – remained in “deeply inappropriate settings” that lacked oversight because they were not registered with Ofsted.
Increased action to tackle problem
Alongside its new powers, Ofsted has used Department for Education (DfE) funding to expand its unregistered social care team, which identifies and investigates providers breaking the law and takes enforcement action.
The regulator is also working with the National Police Chiefs Council (NPCC) to develop a method for it, councils and the police to share information when there is potential criminal involvement in children’s home.
In addition, it is consulting on amending the inspecting local authority children’s services (ILACS) framework to penalise councils for placing children in unregistered homes.
Following yesterday’s prosecution, Ofsted chief inspector Martyn Oliver said: “[This] 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. We are determined to make increased use of prosecutions to tackle the offenders running these settings.”
