Popular radio host Ray Lucia says his investment plan can "generate inflation-adjusted income for life"—but the SEC says that claim is misleading, and wants to stop him from using it, the Los Angeles Times reports. According to the SEC, the nationally syndicated Lucia "performed scant, if any, actual back-testing" of his strategy, called "Buckets of Money." Lucia runs a free seminar, often with Ben Stein, describing the wealth-management plan; that seminar offers a "false sense of comfort," regulators say.
For instance, Lucia says that an investor who put aside $1 million in 1973 would have generated $60,000 in yearly income until 1994; in the meantime, the $1 million would have grown to $1.5 million. The SEC says such investors would have been broke by 1989, given inflation rates. Lucia and his company acknowledged in a probe that "the only testing they actually performed were some calculations that Lucia made in the late 1990s—copies of which no longer exist—and two two-page spreadsheets," regulators add. Lucia's lawyer says that "every once in a while the SEC goes off the tracks, and it has this time."