Adoption agencies under fire

Date: 2008-05-06

Denver Post, The (CO)

Amid financial ills and gripes, the state has proposed rules to shield prospective parents.

Author: Karen Auge

Nearly half the international adoption agencies in Colorado are losing money, five are at risk due to debt and one has generated so many complaints that state officials warned potential clients that they might want to look elsewhere for help with a foreign adoption.

Those findings, contained in a state audit of 22 licensed international adoption agencies, have prompted Human Services Department officials to propose new rules and policies they say are designed to protect prospective parents.

The recommendations come as the state attorney general's office is investigating five unidentified international adoption agencies.

Among the changes the department seeks are:

  • Requiring licensed agencies to be bonded and carry appropriate liability insurance.
  • Requiring agencies to provide full disclosure statements describing fees to prospective adoptive parents.
  • Requiring the agencies to keep a certain amount of cash available.

In addition, the department wants to expand its oversight so it can monitor the business practices and financial health of adoption agencies operating here.

The changes "will benefit the children adopted internationally as well as prospective adoptive families," said Karen Beye, the department's executive director.

Liz McDonough, spokeswoman for the Human Services Department, said the changes do not require legislative approval but that many must be voted on by the State Board of Human Services.

Currently, the department doesn't expect that it will need more money or employees to implement the changes, McDonough said.

The department initiated the review after it received complaints about agencies that arrange international adoptions and after the arrest of Lisa Novak, director of the Claar Foundation, based in Boulder County.

Since June 2006, four international adoption agencies have closed in the state. In addition, the state temporarily suspended the license of one agency, Charitable St. Philomena, in March because it improperly completed adoptions, didn't have a qualified director and refused to allow the state to conduct inspections of its business operations. That agency has since corrected the problems and is again licensed, according to the audit.

McDonough said she did not know the exact number of complaints that sparked the investigation.

"It was not massive, but it was large enough to be concerning" and involved multiple agencies, she said.

Complaints against one agency were serious enough that in February, the state sent letters to five families it knew to be working with that agency.

The state wrote, in part: "This letter is to advise you that this department has received several complaints concerning Adopt a Miracle."

The letter, signed by Beye, included a list of other licensed international adoption agencies.

Adopt A Miracle, based in Lakewood, did not respond to a request for comment Monday.

Several other agencies likewise did not return calls seeking comment.

The state had hoped to include a review of agency salaries in the audit, but eight of the 22 agencies did not disclose salary information.

Of the 14 agencies that did, the Claar Foundation reported paying the highest annual salary: $169,350.

Claar's director, Novak, has been charged with two counts of theft and one count of fraud, and the agency has closed. She was accused of taking thousands of dollars from prospective parents but never completing adoptions. A preliminary hearing is scheduled May 19 in Boulder.

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