"Most of the children living in almost all of the orphanages in this country are not actual orphans, but have been used by orphanage owners to seek external funding for their personal gains," Vivian Cherue, Liberia's deputy health minister for social welfare who is responsible for regulating orphanages told IRIN.
Furthermore, many orphanages are "sub-standard" according to a report issued in March by the Human Rights and Protection Section of the United Nations Mission in Liberia (UNMIL). In 11 out of Liberia's 15 counties, orphanages constitute "major human rights problems," the UNMIL report said.
The number of orphanages in Liberia has mushroomed, from just ten in 1989 to more than 120 today, according to information provided by Liberia's health minister. The country's civil war caused massive displacement with thousands of children having lost track of their relatives.
Yet a survey of 5,000 children in orphanages around the country conducted by the health minister in collaboration with UNICEF revealed that up to 80 percent have parents or family members who are still alive.
Orphanage owners block efforts to re-integrate children into their families and even snatch children, various experts told IRIN.
"The more children that an orphanage has the better they can solicit external funding," said Jerolinmek Piah, coordinator of the National Child Rights Observation Group (NACROG).
"Based on assessments we have been carrying out those orphanage owners have established ties with some philanthropic organisations abroad - sometimes in the United States - seeking and receiving funding for children who they have taken from their families and describing them as orphans whereas they are not," Piah said.
IRIN also interviewed the proprietors of various orphanages, some of whom freely admitted that not all children under their care are orphans.
"Our home has a policy where children who lost their parents, have been abandoned or separated from their families during the war are considered in the same category," said one owner who spoke on the condition of anonymity.
"They are all children in need and they are with us," the owner said.
Another orphanage owner, Enoch Stevens of the Anna Enoch Orphanage Home in Monrovia also said there was nothing wrong with mixing genuine orphans with children who cannot find their families, and denied that his orphanage was using those children for financial gain.
"People believe that we are just making profits and seeking funding for orphans, but this is not the case. Our mission is just to provide care for those children."
Yet few children in such institutions are being cared for properly, according to UNMIL. "Children living in Liberia's orphanages are denied basic rights - ranging from the right to development and health, to the right to identity, family, education, leisure and participation in cultural activities," the report said.
None of the representatives of the orphanages IRIN spoke with would reveal the sources of their funds. Even the deputy health minister Cherue would not name names, other than to say most donors are faith-based organisations headquartered in the United States.
"There was a case reported to the health ministry in 2006 involving an orphanage owner where a foreign philanthropist had provided thousands of American dollars for the upkeep of the orphanage, but the donor later discovered that those children were not orphans," the deputy minister said. "Instead they were taken from families within surrounding neighbourhoods."
"We had to close the orphanage down and reunify the children," Cherue said. "This shows how orphanages are exploiting our children and we are embarking on a process to close down those orphanages engaging in such acts."
Cherue said a Children Protection Taskforce comprising UN agencies, international aid groups and government ministries, has started a nationwide documentation process to identify children in orphanages whose parents are still alive with the aim of reunifying them.
"We talked to some of the children and they know where their relatives and parents are," she said. "[Thus] They cannot be kept in orphanages."
The owner of one orphanage north of Monrovia who asked not to be named told IRIN that Liberians are so poor that orphanages do not need to actively go out looking for children. "It is the parents, guardians or family members who bring children to us because for lack of jobs and money they can no longer feed and care for their children," she said.
Child advocates agree the problem is fundamentally economic. "Poverty is one underlining factor that we have observed where parents and relatives, who cannot afford to cater for their children, send them to orphanages," Susan Grant, head of the British international children charity group, Save the Children in Liberia said.