7 year old out of control.

I look after a 7 year old girl. I've looked after her since she was 5. When I began caring for her, she seemed fairly normal for 5,perhaps a bit spoiled and selfish, but fairly normal. As she settled in here she began small things drawing on walls and floors(then blaming the younger kids who are toddlers and can't draw houses, hearts, stars), breaking toys when she thought I wasn't looking, etc. She then progressed to being very violent to her sister who was barely 2 at the time - slapping her face, punching her in the face and stomach. Then one day while at the park she ran away. I had 3 toddlers in tow and she knew I wouldn't be able to chase her with them. I went as quick as possible and found her shoes about 2 blocks away, I begin to worry she's been abducted. Get home, no child. She shows up a bit later just as I'm dialling police to say I have a missing child. Her response to where she was is 'I wanted to have some fun and run away. Plus, it made you upset and that's really funny.' I call her mom who basically shrugs it off as 'kids being kids. She's so headstrong isn't she?!' mom talks to kid and behavior improves a little. Since then after a brief improvement, current behavior is this:
-telling me and all other female adults in her life she doesn't need to listen to us
-saying she deserves a special treat or new toy or movie at least every 3 days
-jumping on furniture
-taunting, grabbing from and bullying the  other kids here who are 2,2 and 3
-trying to find ways to be mentally and emotionally mean to thenyounger kids because she 'likes' to. She told me this morning she enjoys being mean to them
-coloring on walls, still blames others but it's up too high for them to reach
-dad has to drive to moms house to tell this kid to listen and after much arguing she might listen

Mom and dad separated a couple years ago, amicably they say. The younger girl is well behaved, largely ignored by mom and dad though who only focus on the troublesome one. Their solution was to give her 7 minute timeouts and a paper route to 'teach her discipline', however dad does the paper route every day but Saturday and gives her the money. Sometimes as a punishment she's given extra days of paper delivery. Their other solution was to have '1 on 1' days on Sunday. Dad takes one kid and mom the other for 2 hours. The younger one goes grocery shopping or plays by herself at hone on this day, the older one goes to movies, gets new clothes and perfume, goes on special outings. She's perfectly behaved on these outings(of course) then acts worse than ever once she has what she wants.
I've begun minimum 20 minute timeouts standing in the corner after 3 warnings. It's working a bit. I've tried a reward system which made it worse. Her mom asked if she is jealous of the younger one and if she feels like she needs more attention, kid says yes and continually reminds everyone of this when things dint go her way. This child also lies all the time and tries to manipulate adults by saying things like 'I'm going to tell people you/mom/grandma hit me and you'll all go to jail.' 'you only love me a small amount and I require more than you're willing to give' -clearly a quite from an adult. 'i like being mean to other people at home and I'd be mean to kids at school except I'd go to the office so I'm not'. Mom and dad can't be bothered to discipline. Dad sees the kids about 6 hours a week by choice, he can't stand them. Untold them all she does and that it needs THEIR attention, but they say shell outgrow it. She gets more devious daily. Sorry this us so long, I wanted to highlight all the behaviours I feel are not normal or okay. Any advice or suggestions? Thank you so much for taking the time to read this!

[margypops]

I dont think its going to work for you, I think that you should let the child care of the child go...you have too many problems as listed here with and about her, too many punishments ... its not working for you or her ..good luck .

[busymomma83]

Yeah, I've given notice to terminate care, although I'd love to keep the younger one in care, but I doubt they'll agree to put them in separate dayhomes. I thought I'd see if others have dealt with similar situations and what they did and what worked. Intruly believe this child needs counseling but mom and dad don't. It just makes me sad for both kids and I winder how the parents can just sit idly by.

[margypops]

It is sad when one cannot help a child but you have done your best if somethings not working and she is someone else's child, best to move along..could be she needs to be among'st children in her own age group not toddlers ..