Adopters Plundered Assets

July 18, 2009 permalink

An investigative report by the Globe and Mail suggests that Imagine Adoption was not the victim of an unexpected financial crisis, but that its management had been plundering assets for nearly a year in anticipation of bankruptcy. Cambridge MP and Canadian Minister of State (Science and Technology) Gary Goodyear attended the opening of the offices of Imagine Adoption, and his wife was an employee.

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Bankrupt adoption agency owed money to 400 families

Imagine Adoption director Susan Hayhow is shown surrounded by children during a visit to Ethiopia.

Financial records show potential parents paid up to $25,000 to Imagine Adoption

Jennifer MacMillan

Toronto — From Friday's Globe and Mail Last updated on Saturday, Jul. 18, 2009 03:32AM EDT

Susan Hayhow's stonework century home in Cambridge, Ont., is the envy of her neighbours. With an indoor hot tub, manicured backyard and top-of-the-line appliances, it's perfectly appointed – much like Ms. Hayhow, who appears neatly coiffed and well-dressed in the dozens of photos posted to the websites of her adoption agency and charity. They show Ms. Hayhow during her frequent trips, handing out toys to children in Ecuador and posing in the lobby of the luxurious Sheraton hotel in Ethiopia's capital.

But Ms. Hayhow's financial records paint a very different picture of the 43-year-old's lifestyle – heavily in debt she is now dealing with the bankruptcy of her agency, which has left hundreds of adoptive families in the lurch.

Companies still owed money by Imagine Adoption include a swimming pool business, a home-renovation contractor and a landscaper that confirmed the work was done at Ms. Hayhow's private residence. Also owed money are 400 families, some of whom paid as much as $25,000 upfront to Imagine Adoption, which also operates as Kids Link International.

Ms. Hayhow and her partner, Andrew Morrow, 48, left for Ethiopia a week ago to assist at the transition home caring for 40 children matched with Canadian parents and have been in touch with the bankruptcy trustee. Last month, Ms. Haywood and Mr. Morrow took out a $500,000 mortgage at a rate of prime plus seven per cent on their home, currently assessed at $232,000. The couple had put the home up for sale with an asking price of just under $500,000, but took it off the market.

One adoptive mother said the agency seemed to be flourishing, moving from a smaller basement to a bright, storefront office just over a year ago. The agency was paying $7,000 a month for the new offices, but bankruptcy documents report the rent had not been paid in 10 months.

Sarah, who did not want her last name used, adopted twins from Ethiopia said shortly after she arrived home with the children, she received a letter asking for a $15,000 donation to another charity run by Ms. Hayhow called Global Reach Children's Fund.

“I was just astounded,” Sarah said. “I've never been asked for that kind of money.”

Global Reach Children's Fund operates in Ethiopia and Ms. Hayhow had been fundraising to build a complex called Faith Village that would provide such services as schooling, health care, and food. According to the charity's website, one unnamed family agreed to donate $400,000 last September. Photos posted in December show a poured foundation but there have been no updates.

Imagine Adoption was separate from the charity and maintained its own staff, which included Valerie Goodyear, wife of federal cabinet minister and Cambridge MP Gary Goodyear. Mr. Goodyear attended the grand opening of the agency's new offices last year.

He confirmed his wife, named as co-ordinator of the African adoption programs in an agency newsletter, was laid off on July 10 along with the other 15 employees.

“She was responsible for helping to place children with new families, and was not involved with the financial operations of the agency,” Mr. Goodyear said in a statement.

Deb Matthews, provincial minister for Children and Youth Services, said Thursday the province is working with the federal government to expedite paperwork for the children at the transition home in Ethiopia.

“Our highest priority is to get those kids here and in their homes as quickly as possible,” Ms. Matthews said.

There are also nine children in Ghana who had been matched with Canadian families. The Ministry of Children and Youth Services said the adoptions were suspended when it learned the orphanage, which is not operated by Imagine, was under investigation for child trafficking. Ministry spokesman Kevin Spafford said the orphanage was closed last month.

Ms. Matthews, whose ministry is in charge of licensing adoption agencies, says the province will be following the bankruptcy trustee's investigation of the finances of Imagine, which had a license in good standing.

“We're always looking at how we can improve services for families and this will be an opportunity to do that,” Ms. Matthews said. “We're obviously concerned.”

With a report from Stephanie Chambers

Source: Globe and Mail