Lawsuit: Financial adviser took 91-year-old San Diego woman's life savings

Reid Johnson faces multiple accusations

SAN DIEGO - Sanctions have been issued against a financial adviser accused of scamming a 91-year-old San Diego woman out of nearly all of her savings -- nearly $1 million.

"I get up like three to four times a night. I read, I can't sleep," said Celia Wakefield.

At age 91, Wakefield's days are filled with anxiety.

"I feel horrible. I feel destroyed … When I buy lipstick, I feel guilty," said Wakefield.

Her ordeal began in 2007, when she and her husband Charles -- a retired Air Force physician --- accepted a mail invite for a dinner seminar from Reid Johnson, an Arizona-based financial adviser.

"He convinced us they could do much better and the annual fees would be much less," said Wakefield.

She would come to regret that decision.

According to lawsuit she filed, Johnson convinced the Wakefields to invest hundreds of thousands in investment offerings, many controlled by him, including investments like an office building in India. The building is now worth nothing on paper.

Wakefield's attorney, Tim Karen, said Johnson, also an insurance agent, talked the couple into buying unaffordable life insurance. Celia Wakefield is now shelling out $41,000 a year in premiums so he could collect a commission.

The lawsuit also alleges Johnson convinced them to buy yet another policy, and then transferred it to a company in his name with mysterious investors as the beneficiaries.

"It goes into a black box and we don't know who has the keys. We know the black box is headquartered at Mr. Johnson's office," said Karen.      

Karen said Wakefield is now out almost all of her savings -- nearly $1 million.

Wakefield's husband passed away in 2010. She remembers talking to him about stories like the Bernie Madoff scandal.

"I always said to my husband when I heard these cases, 'I don't want to be a bag lady,' and he said, 'Don't worry.' Now, I'm worried," said Wakefield.

Johnson may also be feeling the pressure. He was just fined $15,000 and his stockbroker's license was suspended for 45 days for unrelated security violations.

According to the lawsuit, he's facing an IRS lien of nearly $11 million in an unrelated case.

In a bizarre move, Johnson recently tried to get Wakefield declared mentally incompetent. Karen said when it was clear she didn't have dementia, they withdrew the motion.

Johnson's attorney declined comment.

Karen said he'll be sending out letters asking for state and federal investigations.

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