Ombudsman Jerry White branded the delays by the council as "indefensible" and found that "maladministration causing injustice" had taken place.
The boy, who cannot be identified for legal reasons, was taken into the care of Luton Borough Council in 2000 at the age of five after suffering neglect and witnessing violent and sexual acts.
He was placed with foster parents in Southend-on-Sea, but after less than a year began to display sexualised behaviour, was assessed and a recommendation was made for counselling should the behaviour continue.
Although further incidents were reported between 2004 and 2006 he was not assessed again until May 2006 and did not start therapy until February 2007.
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