I don't think so or the USDA would not let them sell aluminum for food use. I think this is an old wives tale. Also if you refrigerate the food aluminum will keep the food cold longer. The aluminum doesn't come off and we have metals in our bodies already so why should this be a problem.

No.
Kids delicious recipes,infants milk formula, tasty grilling recipes and the best baking recipes are being wrapped with Reynolds aluminum foil. It is recommended.

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• Aluminum foil is made from an aluminum alloy which contains between 92 and 99 percent aluminum. Usually between 0.00017 and 0.0059 inches thick, foil is ...
• Delicious dinner recipes, tasty grilling recipes and the best baking recipes to use with Reynolds aluminum foil, parchment paper and oven bags.
reynoldspkg.com
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http://thyroid.about.com/cs/basics_starthere/a/10signs.htm

It appears that your sister wrapping her child’s sandwiches in aluminum foil is perfectly fine, especially if she uses Reynolds Wrap foil. This foil is made from 100% recycled aluminum and is totally safe to use with food. This aluminum that is made from recycled aluminum is as safe and clean to use with food as foil that is brand new and called virgin aluminum. The company melts down the aluminum and this process requires heating the metal to more than 1200°F. This process burns off any debris in the metal. Once this material turns into a molten liquid, the aluminum is sent through a filtration process and then is poured and rolled into thin sheets. This is what we receive when we purchase aluminum foil in a box.

With the filtration system and the heating of the metal, it seems that the aluminum foil is the perfect wrap for your sister’s children’s lunches. I never thought of using it that way myself but after you described it and the way the tabletops at the schools are filthy, the aluminum foil seems like a great idea. :-)