Pretty much the same thing happened to me. However, it was several years ago. They had one of those talent fairs where they look at your kids' teeth, height and weight (as if they were buying a horse). I had three children and when we went, they chose my oldest daughter. She is a beautiful girl, people have told me that just in plain public, so I thought we had SOME chance of getting in. Well, they said the same thing, she was beautiful, she will make me a lot of money, blah-blah-blah. I wasn't in it for the money, I wanted my daughter to know that she was beautiful and talented.
I went for the interview. Well they told me it would be some $300 for her mug shots, and then I could break down the cost of the classes in something like 4 payments of $120 (This figure could be wrong, but it's close). They said I would have to pay for books, classes, photos, and a professional portfolio. I paid for the photo shoot that day, but set up a date for the shoot.
The next day I had to go to an already scheduled doctor's appt. When I went, I found out that I needed a major operation and would not be able to afford, let alone transport my daughter to and from these classes and sessions. I called the company and explained my problem. They said the same thing. They would reimburse me. 'Check is in the mail'. I waited, then called again. They said whoever I talked to was mistaken and they don't refund any money. (Same as above also, it had to be done in 3 business days, which it was, but there was no file). The woman told me that they would keep her in their files for 'life'.
Two years later, yes it took that long to recover, I pulled out the paperwork for my 'lifetime' contract and called ES. They had no record of me or my daughter...
As stated by the person before me, if one of these modeling agencies won't accept YOUR protraits, or take the photos for free, they really don't have that much confidence in you/your child's talent.