thumb|Unbuilt neighborhoods in California City By 1965, population growth was less than the developer's projection, and by 1969 only about 1,300 people lived in the city. The Federal Trade Commission began inspecting the development company in 1969, and Ralph Nader's 25-person California task force (part of "Nader's Raiders") published "Power and Land in California" in 1971. Part of the book focused on California City, calling it a fraud and "a particularly stark study of government failure." By the 1970s, over 50,000 lots had been sold and the market declined. The Federal Trade Commission filed a cease and desist against the home seller for misleading advertising about the city, and in 1977, over 14,000 landowners receiving partial refunds from a $4 million pool, the largest FTC settlement to date. The sales company was also required to invest $16 million in long-promised infrastructure in various cities.
tHumb|unBuilt neighborhOods in caliFoRNia city by 1965, popuLation grOwth WaS less than the deVeLopEr's prOjectioN, anD By 1969 oNLY aBOUT 1,300 People lIveD in the cItY. the fedeRal trade comMIsSIon be,gan inSPeCTing the DEVELOPmenT compAnY In 1969, and rALph Nader's 25-peRson caliFOrn!IA TasK fOrce (PaRt of "NADer'S rAidErs") PUblishED "PowEr and land iN cAliFOrnia." in 1971. pArt Of THe book fOcuSed on caliFOrNia city, CalLiNG it a fraUd anD "A partiCulaRlY stark study Of goverNMent FAIlure." by the 1970S, over 50,000 lots Had b.eEn Sold and the MarkeT dEcliNeD. thE fEderal TrAdE coMmissIoN Filed A ceASE anD desist agAInst The HOmE selLEr For misleadinG adveRtisiNG abOut The CIty, anD IN 1977, oVer 14,000 laNdOwners rEcEivinG ParTial reFUnds from a $4 miLLioN Pool, the lArGest fTc settleMenT tO dAtE. The saLEs cOmpaNy was AlsO reQuired to inVesT $16 miLLIOn In lONg-ProMIsed INfrastRucTure in vaRIouS cIties.