KINGSTREE -- A mile off the main road, past the slash pines, cotton fields and "Jesus Saves" signs, a modest mobile home squats on a narrow loop where gravel turns to dirt.

Inside, Wendy Johnston perches on an armchair barefoot and sporting faded jeans. On the wall hangs a black-and-white photo of her coronation as Miss Lake City 1986.

She had gone far since those days, occupying a world of exclusive addresses, private schools and functions where she mixed with Charleston's elite. Now, she's back where she started, in her mother's rural double-wide, rooming with her four children.

Her eyes skate across the room and she shakes her head. "This is not the life my family is accustomed to."

Her's is a story of a small town girl from meager beginnings in the Pee Dee who weaved her way into the Holy City's high society. Along that trail, she left behind a mountain of debt, a slew of aggrieved lenders and a swarm of questions about her motives and actions.

The 42-year-old former beauty queen left Charleston late last year amid allegations of forgery and fraud after her latest venture, a home for recovering addicts and alcoholics, collapsed in a hailstorm of internal strife and unpaid debts.

Her landlord moved to evict her from her Daniel Island home the same month her program, Faith Haven, closed its doors, leaving a mansion full of vulnerable addicts scrambling for a place to stay. She also left behind financial records that raise new questions about how she spent the money that generous donors sent her way.

Take the $3,450 in Faith Haven money Johnston spent on her kids' hockey league memberships. Or consider the $1,061 she dropped at a discount retailer, buying jewelry, clothes and other baubles with Faith Haven's cash.

Johnston sees it differently. She says her motives were pure, her organization above-board. Her voice resonates with indignity. She paints herself as the victim of a vindictive campaign of lies waged by her soon-to-be-ex-husband's family and other misinformed detractors.

"When the truth comes to light, I would hope there will be a lot of remorse from the people who contributed to the closing of Faith Haven. They can do what they want to me. I have nothing to hide."

Crafting her story

Johnston first made a splash in Charleston when she and her husband, Peter, opened a Mercedes-Benz dealership in 2003 along Savannah Highway's auto-mile. Standing in a showroom replete with leather sofas and tasteful artwork, Johnston touted the educational achievements and business acumen that helped her become the city's lone female car dealer.

At the time, Johnston told The Post and Courier she was the daughter of a successful businesswoman and had proven her own mettle by juggling motherhood and work while earning business and sociology degrees from the College of Charleston.

When asked her goal in life, Johnston replied: "To be a good example to everyone I meet."

The life story Johnston told, however, differed markedly from the one she had lived. She grew up as Wendy Clarke, the only child of a widowed Lake City hairdresser. She came from a modest home and never completed high school.

She earned her equivalency diploma in 1985 but never the college degree or the paralegal certificate listed on some resumes, her education transcripts show. And she did attend the College of Charleston, but for just one semester in 1990. She withdrew from two courses and failed a third, leaving with a zero grade point average.

She came to the Holy City in the late 1980s after winning the Miss Lake City pageant and competing for the title of Miss South Carolina. She landed a job as a paralegal for a law firm. While working there she met her future husband, Peter Johnston, at a real estate closing he had brokered.

They married in November 1993, her wedding announcement noting that she was a College of Charleston graduate.

Her in-laws recall her boasting of a vast trust fund and that her grandmother owned a home on Water Street, one of Charleston's premier addresses. Former friends also recall her stories about the enormous wealth of her husband's family, and how they owned a Manhattan hotel, a medical equipment company, Oriental rug stores and other holdings.

None of it was true.

Still, Johnston continued to win new admirers with her girl-next-door looks, down-home charm and earnest talk of Christian values.

Marilyn Johnson remembers Johnston from First Scots Presbyterian Church in Charleston, where both attended services: "Everyone just fawned over her. Everyone in the church thought she was the greatest thing since sliced bread."

Cracks, however, began to emerge in her facade.

While working for the Steinberg Law Firm, nearly $6,000 in checks under her control went missing around 1998.

David Pearlman, a partner in the firm, would later testify in a deposition that Johnston was questioned about her "hoarding" of checks, but was allowed to stay on with the firm after receiving counseling and treatment for an "emotional issue." No charges were filed.

Pearlman further demonstrated his faith when he put up $400,000 to finance the Johnstons' Mercedes dealership, South End Motor Co., in January 2003. The dealership went belly-up in nine months, taking with it the money Pearlman and others invested.

His loan has yet to be repaid, as are tens of thousands of dollars the Johnstons owe to private schools, publications and businesses.

Johnston says she knows nothing of the missing checks from Pearlman's firm and lays blame for the dealership's failure on her husband, who had a background in car sales.

She says Peter began withdrawing from the dealership as he struggled with bipolar disorder and she was unable to keep it going. Peter Johnston disputes her story, insisting that he poured his all into the business and that his wife's problems are of her own making.

Appealing for help

As bills piled up, Wendy Johnston began telling friends and creditors that her husband was dying from advanced liver cancer and would soon be in need of hospice care. She sent one old friend an e-mail saying Peter had "stage five" liver, colon and testicular cancer.

Peter acknowledges having some medical problems, but he and his relatives say cancer was not among them. It would take years, however, before some people realized the truth.

One of those folks was Sam Propst, a retired middle school teacher who lived in Lake City in a rambling brick and terra cotta home that he inherited from his family.

Johnston stopped one day to inquire about purchasing the home and one owned by Propst's neighbor, possibly to use as a bed and breakfast. She told him she and her husband had given up their car dealership in favor of a slower-paced life after Peter discovered he needed a liver transplant.

Johnston never bought the homes, but kept in touch with Propst and introduced him to Kathy King, her children's music teacher at Ashley Hall.

After the two became friends, Propst says Johnston phoned one day with terrible news: King, who had recently lost her son in a car accident, had fallen on hard times and was about to lose her home to foreclosure.

Propst says he gave Johnston $16,000 to stave off creditors, and later agreed, at her urging, to take a $94,500 loan on his house to help King. On May 18, 2004, Propst gave Johnston power of attorney to close on the loan and get the money.

Propst says months passed before he learned that King had never seen a dime of that money and her home was never in danger of foreclosure.

Propst, 56, is still paying off the loan and will be, he estimates, for the next 25 years.

Johnston insists her husband arranged the deal with Propst, and the money was always intended to help them settle a lawsuit with an investor in the failed auto dealership. She says she doesn't know whether her husband repaid Propst or not.

Propst just shakes his head. He says he hardly knows Peter Johnston and only recalls speaking to him on one occasion. Peter Johnston says he had nothing to do with the loan deal, and Propst agrees.

Debts mount

In the years after their dealership closed, the Johnstons moved about the Lowcountry and the Pee Dee, living on tony Sullivan's Island, in a stately home in Kingstree and in rental properties on affluent Daniel Island.

Even with thousands of dollars in financial help from Peter Johnston's mother over the years, the bills mounted.

In addition to the $400,000 owed to Pearlman, more than $117,000 in other judgments had been handed down against the Johnstons and their failed dealership. Still, Johnston continued to enroll her children in top-flight private schools.

They left Ashley Hall in 2005 with an outstanding tab of nearly $53,000, records show. That bill was still unpaid when she enrolled the children in First Baptist Church School, where the tuition bill would approach $31,000 by the spring of last year.

In February 2009, Johnston was evicted from her rental home on Daniel Island's Barfield Street for failing to pay the rent. She separated from her husband the following month and moved into a friend's home with her children.

Struggling to stay afloat, Johnston wrote to the staff at First Baptist in April of last year asking for tuition assistance. She told the school her husband was hospitalized and unable to work due to cirrhosis of the liver, possible cancer and other maladies.

She described herself as a full-time law student and told others she was enrolled at the Charleston School of Law. The school has no record of her.

Her plea was followed by a letter, purportedly from Daniel Massie, her pastor at First Scots, urging First Baptist to give the family financial aid in light of the "great deal of suffering" they had endured because of Peter Johnston's problems.

Massie swore in an affidavit that he didn't write a word of the letter and his signature was used without his consent.

Peter Johnston also calls the letter bogus. He says he spent several days in a hospital for gall bladder surgery that month, but otherwise was working at a car lot.

Wendy Johnston says she doesn't know a thing about the letter and had no hand in its creation. But she doesn't deny money was tight, a situation she again blames on her husband.

A new plan

After the dealership folded, former friends recall, Wendy Johnston pitched several business ideas, from running an equestrian center to opening a liquor store. Nothing stuck until she hit upon Faith Haven.

Johnston says she spent a couple years developing the business plan, drawing on her experience volunteering with Faith Home, a decades-old, sober-living facility in Greenwood. She incorporated her fledgling organization in November 2008 and set up a governing board, headed by Charles Dukes, a longtime friend from Branchville.

In May 2009, Johnston approached the local missions committee at First Scots. She told the panel she had volunteered for eight years with Faith Home, serving on its strategic planning committee, and that the home wanted her to direct an expansion to Charleston.

Johnston told the panel she had even put her own money in to the program. Over time, she hoped to win grants and get 25 churches to commit up to $5,000 each to support Faith Haven's operation.

Eager to help the faith-based initiative, the missions committee gave Johnston $7,500 that she said was urgently needed to buy a van to ferry residents to therapy sessions.

The day after depositing the check in Faith Haven's account, Johnston wrote a check to herself from the fund for $6,500 in cash. The van was never purchased, church members say.

The committee accepted Johnston's story largely because she was a member of the church. The committee didn't realize she had no formal connection to Faith Home. Aline Barnes, who founded Faith Home with her husband 44 years ago, recalls Johnston visiting a friend at the facility once or twice, but that's all. "We have had nothing to do with her," she says.

Johnston says it's all a misunderstanding and that the church's cash was used for housing and transportation for clients. She insists she has proof of this, but refuses to share it on the advice of her attorneys, whom she will not name.

New troubles

Faith Haven seemed to struggle for cash almost from its inception. Just months after moving into condominiums on Daniel Island, the facility drew complaints from neighbors, and Johnston was evicted for failing to pay rent.

Dan Mengedoht knew none of this when Johnston called about his family's historic, 6,000-square-foot mansion on Rutledge Avenue, near Colonial Lake. It had been for sale for 13 months at $2.5 million.

Mengedoht says Johnston told him her husband owned car dealerships in Atlanta and New Jersey and that they were looking for a new home closer to her downtown activities. Johnston, who said she was in law school, then suggested using the home for her non-profit, Faith Haven. She told him she wanted to lease with an option to buy, he says. The Mengedoht family agreed, thinking they were helping a good cause.

The relationship soured after neighbors complained of noise, disruptions and a general lack of supervision at the home, which was designed to accommodate 12 people but was catering to as many as 20 at a time. Johnston also fell behind on rent.

Participants in the eight-week program complained that Faith Haven offered little counseling or other assistance, and the operation always seemed to be short on money and supplies.

They say Johnston made them apply for food stamps and raise funds for the home while they spent their own cash for groceries and for gas to get to Alcoholics Anonymous meetings.

Faith Haven records show nearly $58,000 in donations deposited into Faith Haven's bank account between June and Sept. 23, 2009. Of the checks written off that account, $24,447 went to Johnston or cash.

Her children's hockey league money also came out of that account. Another Faith Haven account shows expenditures at movie theaters, burger joints and Stein Mart, for jewelry and clothes. She says the expenses were for the residents.

Johnston says she never drew a salary from Faith Haven and put more of her own money into the organization than she got back. The check for hockey league funds, for example, was intended to reimburse her for money she spent on Faith Haven, and the check was approved by her board president, Charles Dukes, she says.

If she is guilty of anything, she says, it's mingling her own funds with that of her organization. As proof, she waves a stack of receipts for some $2,700 in Faith Haven expenses she says came from her pocket.

"None of the money for Faith Haven ever went to my personal use," she says. "Every dime of Faith Haven money can be accounted for and has been accounted for."

Dukes won't discuss the inner workings of Faith Haven, but the situation concerned him enough that he fired Johnston in October and dissolved the non-profit corporation.

Dukes also reported her to Mount Pleasant police for allegedly forging his name in the purchase of a Chevy Suburban. She was arrested and spent four days in jail before posting bail. During her jail stay, Charleston County sheriff's deputies served her with two outstanding warrants for check fraud.

For Dukes, the episode was particularly painful because he and his wife had been close friends with Johnston for years. Johnston sang at his wedding, and his wife served as her matron of honor. They named Wendy and Peter the godparents of their two children.

"This was really somebody I loved and trusted," he says.

Dukes says the idea behind Faith Haven appealed to him as a Christian, and he saw some good accomplished, despite the program's many problems.

"I saw it turn some people's lives around that, when they came in here, were in dire need, and I saw them leave well on the way to recovery," he says. "I'm just disappointed Faith Haven had to close its doors because it had all the potential to be something Charleston sorely needed."

A new start?

Johnston's face beams from the old photo on her mother's wall, a tiara sparkling upon her raven hair. Below the portrait, Johnston leans forward in the armchair. Her eyes well with tears for the first time on this gray morning as she talks about the addicts she left behind.

Several still call her and send her notes, she says, adding that she got together with a group of them over Christmas. Some have remained sober while others have tumbled off the wagon. It pains her, she says, to think about what might have been.

She blames her in-laws for destroying Faith Haven and derailing fragile lives in the process. She says they are trying to get back at her for finally leaving Peter, a claim Peter and his family deny. They say they have shared information about her dealings to protect others.

For now, Johnston says, she is biding her time until the divorce is over.

When asked about her plans, she hesitates and then smiles, as if she can't resist sharing the news. She says she wants to revive Faith Haven and open two new sober-living facilities.

Johnston won't reveal her timetable or where these new facilities might be located. But she makes one thing clear: She is already lining up potential investors.

Reach Glenn Smith at 937-5556 or