The youths involved in the study entered the project between September 1, 1994, and December 31, 1997. The FEI is designed to improve family functioning by empowering parents. Families involved in the FEI project were randomly assigned to receive either an Extended Services Intervention (ESI) or the FEI. Families in the ESI group received monthly phone contacts, and, if indicated, referral information. FEI families received three 1-hour, home-based meetings per week from a clinician-trained paraprofessional. The final 12-month follow-up analysis shows that youths who completed the FEI experienced significantly lower rates of new charges and significantly fewer new arrests than youths not completing the FEI. Further, considerable juvenile justice system direct cost savings were projected to be associated with providing FEI services to diversion cases over a two-year period. The FEI and ESI youths did not differ significantly in their total arrest charges and total number of arrests during the 12-month follow-up. The completion of the intervention was thus found to be the most important factor in determining recidivism during the 12-month follow-up. 11 tables, 2 figures, and 50 references