Missing Money, Unpaid Bills and Forgotten Clients

The widow of an Air Force veteran, Osterhout was not penniless. She had money in the bank and received veterans benefits of more than $1,000 a month.

The source of her troubles was Anne L. Chavis, the court-appointed guardian who controlled her money and was supposed to look after her.

Chavis was late paying the rent on Osterhout's apartment in Colton. She was late sending a monthly living allowance. She was late paying for her medical insurance, which at one point was canceled.

"I just felt like I wanted to lay down and go to sleep and die," recalled Osterhout, 62.

For more than a decade, the Department of Veterans Affairs and California's probate courts entrusted Chavis with dozens of vulnerable adults, most of them disabled veterans and their survivors.

She exploited and neglected many of them with seeming impunity — conduct that highlights the flaws in a broken system.

While supposedly under the supervision of the VA and the courts, Chavis often failed to pay her clients' bills and refused to tell them what she was doing with their money, interviews and records show.

She arranged to buy the home of one elderly client at a discount — while pretending that someone else was the real purchaser.

She helped a business associate inherit the estate of another client — a senile, nearly blind World War II veteran.

She once paid a lawyer with money she took from the bank account of an 80-year-old widow.

When VA officials and the courts finally demanded answers after years of inaction, they discovered that Chavis had failed to account for more than $1 million of her clients' money.

Courts have ordered her to come up with the funds.

To date, she has not paid a cent.

Chavis, 72, denied any wrongdoing and said she did her best for her clients. "When I started doing conservatorships, I wasn't that smart," she said in an interview. "There were probably a lot of things that I overlooked or didn't do."

She said she lost track of her wards' finances after her bookkeeper died in 2002 and her longtime lawyer, who helped her run her practice, lost his license a year later. Nevertheless, Chavis said, "I don't want to blame nobody for something I should have been on top of myself."

Chavis said she loved her clients, many of whom suffered from mental illnesses. She visited them regularly, she said, and always returned calls that seemed important.

"Gee whiz, I think I've done a good job with the type of clients that I had and the amount that I had," she said. "It's really crazy, but I really care about those guys."

She vowed to account for all of their money.