Over-reliance on police by Out-Of-Home Care (OOHC) service providers is a key contributor to the criminalisation of children in care. Drawing on interviews across judicial, legal, youth justice and children's advocacy sectors in New South Wales, Victoria, and England and Wales, we propose a conceptual model which explains the criminalisation of trauma via policing and residential care policies that emphasise risk mitigation, and which are currently devoid of therapeutic practice. Criminalisation of trauma is contingent on surveillant assemblages positioning vulnerable children as risks to themselves, others, and property. This approach justifies criminalising responses with deleterious impacts on children and staff within both systems. We discuss the need for systemic reform that shifts from perceptions of children in residential care as “risks” that need to be managed via carceral logics. We argue the case for a system that instead emphasises the importance of therapeutic responses for vulnerable children and families involved in child protection and OOHC systems.