If you believe theft is involved gather the evidence and report it to the police,
the evidence will be reviewed by the CPS who will decide if there is sufficient evidence for a charge to be made.
If the police are not interested and you are considering civil proceedings, the answer to your question is probably no as the children are not old enough to start civil proceedings but an adult can start proceedings on their behalf. A good test of the civil evidence is to approach a solicitor and ask if they would take on the case on a conditional fee agreement (no win no fee), as they would need to be confident of the outcome before they accepted the case.
A solicitor was probably involved in the claim for compensation and they may be a good starting point for a civil claim.