I don't see anything about it being illegal. As a matter of fact they expect the children to help the parents financially.

Benefits For Children
SSA Publication No. 05-10085, September 2009, ICN 468550 [View .pdf] Get Adobe Acrobat Reader (En Español) [Audio mp3] speaker icon


About 3.8 million children receive approximately $1.6 billion each month because one or both of their parents are disabled, retired or deceased. Those dollars help to provide the necessities of life for family members and help to make it possible for those children to complete high school. When a parent becomes disabled or dies, Social Security benefits help to stabilize the family’s financial future.

NOTE: Disabled children whose parents have little income or resources may be eligible for Supplemental Security Income benefits. Contact us to get a copy of the publication, Benefits For Children With Disabilities (Publication No. 05-10026).