By Michelle Conlin

NEW YORK (Reuters] -Private equity funds are increasing their investment in troubled youth behavioral services, according to a recent report from the Nonprofit Private Equity Stakeholder Project.

Private equity firms have been buying services to help children with intellectual or developmental disabilities. They also buy into programs for troubled teens, such as foster care and juvenile justice.

Non-profits have traditionally provided youth behavioral healthcare services. According to the report “The Children Are Not Alright: How private equity Profits from Behavioral Health Services For Vulnerable And At-Risk Youth”, this is slowly changing.

Report cites private equity’s “troubling record” in youth service provision. They claim that unlicensed staff and inadequate training have contributed to youth living in unsafe conditions.

According to the report, private equity firms are often aiming for doubling or tripling their investments in as few as four years.

It states that, within just two years of becoming the owners of The Mentor Network’s foster care and disability service provider, Centerbridge Capital, and The Vistria Group had taken nearly half a million dollars in dividends funded by debt from The Mentor Network.

Elsewhere it says Alaris Royalty, which owned foster care and troubled teen company Sequel Youth & Family Services, reported generating a $71 million profit, or 23% annual return, on its investment in the company.

Reports state that the Mentor Network has been under attack for widespread neglect and abuse at its residential care and foster care facilities.

Sequel Youth & Family Services has also faced criticisms.

Sequel was in the news when it abruptly closed its Bernalillo Academy, Albuquerque New Mexico. This school treated young people with developmental and behavioral challenges. Local investigators concluded that staff were not properly trained and background checked at the facility. In addition, there was a spate of incidents in which children were abused by staff.

Sequel was subject to similar criticisms and has been forced out of other facilities in the country.

Sevita, and Sequel declined to comment.