Former Advisor to Pay $4 Million in SEC Deal

A former investment advisor accused of bilking professional athletes and seniors out of nearly $18 million has agreed to pay some of it back.

Donald D. Lukens, 51, who kept company with NFL and NBA stars while operating from his high-rise office in Oxnard, will pay back $3.27 million to investors and more than $1 million in interest and penalties, said Securities and Exchange Commission officials, who had filed a civil complaint against him.

“We are dealing with a person that has abused trust and is guilty of greed,” said Cheryl J. Scarboro of the commission’s enforcement division. “He engaged in acts that defrauded at least 100 people of their money. He misappropriated large amounts of funds and made misrepresentations about the use of the proceeds and the risk involved.”

In October, Lukens of Camarillo was accused in the complaint of operating an elaborate investment scheme that entangled friends from his days growing up in Oxnard, neighbors, a pastor and a long list of professional athletes.

Former National Football League running back and Hall of Fame member Eric Dickerson lost more than $1 million in an investment deal with Lukens, the SEC said. Others who invested with Lukens are Tampa Bay Buccaneer defensive end Simeon Rice, Denver Broncos receiver Shannon Sharpe and National Basketball Assn. players Bryon Russell and Keith Van Horn, the agency said.

“Financial planning is the wild, wild west when it comes to the potential for excess,” said NFL player representative Leigh Steinberg. “Nothing in the collegiate experience prepares [professional athletes] for the dangers inherent in a $15-million signing bonus.”

But athletes with money to burn were not the only victims, officials said. Among those who lost money is John Silva, an Oxnard resident and high school friend of Lukens who entrusted Lukens with $170,000 of an inherited life insurance policy. He never saw a return on the investment, which was his life savings, said Brian Osborne, Silva’s Oxnard-based attorney.

“I’m curious about where he is going to get the money from,” Osborne said when told of the agreement reached between Lukens and the SEC. “He said he would make a safe investment, and he lost it all. The ones he hurt the most were the ones who could least afford it. You really need to do your homework before you stick your money with someone like this.” Under the terms of the agreement, Lukens will be barred from working as a licensed securities broker or in the investment industry, Scarboro said. Lukens also will not be allowed to declare bankruptcy to escape his debt.

Lukens, who operated without an attorney in his most recent dealings with the SEC, could not be reached for comment Tuesday.

He filed for protection from creditors in 2001, declaring assets of $1 million and debts of more than $47 million.

The Lukens case is the second in three months to focus on a Ventura County resident.

In July, Larry Curtis Waltz of Ventura admitted in federal court to bilking dozens of California investors out of nearly $6 million. Like Lukens, Waltz will repay the investors, many of whom were elderly and had entrusted him with their life savings. Waltz is expected to begin a 21-month prison sentence in October. He also got three years probation.