We’re still hearing stories and seeing images of the children of illegal immigrants being detained after they encounter immigration officials. While the real fault for their situation rests on the shoulders of the adults who put them in such a precarious position by illegally trying to bring them across the border, it’s still difficult not to be sympathetic to their plight. But who is actually housing these kids while their status is being determined?
In many cases, it’s not the government at all. That job gets contracted out to a variety of organizations, including charities. And not all of them are on the up and up. The New York Times had a surprisingly even-handed story this weekend covering one of these agencies. The person at the center of the tale is Juan Sanchez, founder of Southwest Key Programs. Supposedly a “charity” designed to aid impoverished children, it turns out that Sanchez has been raking in massive amounts of cash while not spending very much of it on his young charges living in overcrowded facilities.
Southwest Key has collected $1.7 billion in federal grants in the past decade, including $626 million in the past year alone. But as it has grown, tripling its revenue in three years, the organization has left a record of sloppy management and possible financial improprieties, according to dozens of interviews and an examination of documents. It has stockpiled tens of millions of taxpayer dollars with little government oversight and possibly engaged in self-dealing with top executives…
Though Southwest Key is, on paper, a charity, no one has benefited more than Mr. Sanchez, now 71. Serving as chief executive, he was paid $1.5 million last year — more than twice what his counterpart at the far larger American Red Cross made.
Southwest Key has created a web of for-profit companies — construction, maintenance, food services and even a florist — that has funneled money back to the charity through high management fees and helps it circumvent government limits on executive pay.
Sanchez is described as a man who has “built an empire on the back of a crisis.” His organization was flush with $61 million in cash as of last year and was in the business of loaning more of it out to real estate developers than it spent on the children, acting like some sort of unregulated bank. Sanchez’s base salary is $1.5M, which is more than the head of the Red Cross makes. His wife pulls in another half million in salary.
So why isn’t the New York Times howling from the rooftops about yet another “failure” of the Trump administration in handling children in detention? Because Sanchez has been doing it for years and was a key player in this same line of work all through the Obama administration. It’s apparently been much harder to track and regulate Southwest Key because it operates as a charity rather than a typical government subcontractor. Still, there are rules in place for charities, including maximum compensation for executives who receive government contracts, but Sanchez seems to have been able to skirt them all.
This guy is raking in millions for himself and his partners when he was supposed to be caring for separated children. But he’s currently taking up so much of the load providing housing for the kids that the government seems unwilling or unable to figure out what to do about him. Props to the New York Times for bringing this situation to light. The question now is what we do about it.