Michael Donovan told his trial jury at Leeds Crown Court that one of his daughters continued living with him after he and his wife divorced.
He said his other daughter also came to live with him after his ex-wife had been taken into hospital with drug problems, the three setting up home at Lidgate Gardens, Batley Carr.
Giving evidence in his own defence, Donovan said that the girl's school had contacted social services over concerns about the way the girls were being cared for.
In 2006, Donovan said, he collapsed and was taken into hospital for two weeks.
He told the jury: "Social services said they would look after the children until I came out of hospital...it got me right upset and unhappy."
Donovan's barrister, Alan Conrad QC, asked him: "Did you take one of your little girls from care?"
"Yes," Donovan replied. "She was having problems. I took her away from the foster home for Blackpool."
"Did you bring her back?" Mr Conrad asked.
"No," said Donovan. "I didn't know who called the police, they came and took her back to foster care."
Mr Conrad asked him if he was charged with abducting his daughter. Donovan, 40, replied that he had, but that the charges were dropped when the case came to court.
The court was also given other details of Donovan's criminal record, which includes convictions for criminal damage, arson and shoplifting.

Loan

Yesterday's hearing heard that in the run-up to the kidnap plot allegedly hatched between Donovan and Karen Matthews, Matthews asked him for a £20,000 loan. He claimed she made the request at the same time as she had asked to meet, in secret, in a Dewsbury town centre cafe in January to talk about "a problem."
"She asked if I could loan her some money," Donovan claimed. "It was a big amount, £20,000, I did not have at the time."
Mr Conrad asked his client whether he would have loaned the money if he had had it.
"No," Donovan said.
He claimed Matthews there asked him to "look after" her daughter, Shannon, until reward money had reached £50,000, threatening to get "three lads" onto him if he didn't.
Mr Conrad asked his client if he agreed to the plan.
"I didn't want to agree," Donovan said. "But she told me the three lads would do me, my car and my flat."
It is alleged that Shannon was snatched and held at Donovan's flat for 24 days from February 19, eventually found inside a divan bed.
Donovan and Matthews both deny kidnapping and falsely imprisoning Shannon. They also deny perverting the course of justice.
Proceeding