El Capitan Advisors, Inc. and Andrew D. Nash

U.S. SECURITIES AND EXCHANGE COMMISSION

Litigation Release No. 26327 / June 17, 2025

Securities and Exchange Commission v. Andrew Daniel Nash and El Capitan Advisors, Inc., No. 2:25-CV-05066 (C.D. Cal. filed June 4, 2025)

SEC Obtains Final Judgment Against Investment Adviser Charged with Misappropriating Client Funds

On June 11, 2025, the Securities and Exchange Commission obtained final judgments against Santa Barbara, California-based investment adviser, El Capitan Advisors, Inc., and its principal, Andrew Daniel Nash, who the Commission charged with misappropriating $15.3 million from an advisory client to whom they owed a fiduciary duty.

The SEC’s complaint, filed on June 4, 2025 in the Central District of California, alleged that, in June 2021, Nash and El Capitan entered into an agreement with a public company advisory client to provide cash management services for tens of millions of dollars of the client’s money held at various financial institutions. In reality, according to the SEC’s complaint, in breach of his and El Capitan’s fiduciary duties as investment advisers, Nash transferred over $15 million out of the client’s accounts and spent a portion of that money to buy a $4.6 million home in Santa Barbara, California. The complaint further alleged that, to conceal his theft, Nash fabricated account statements purporting to show the client’s money still held at the financial institutions. Additionally, according to the complaint, Nash filed Form ADV reports with the SEC that materially overstated El Capitan’s assets under management.

Nash and El Capitan, without admitting or denying the allegations in the SEC’s complaint, consented to the entry of final judgments permanently enjoining them from violating Sections 206(1), 206(2), and 207 of the Investment Advisers Act of 1940 by committing or engaging in specified actions or activities relevant to those provisions. The final judgments also orders (i) Nash to disgorge ill-gotten gains of $4.6 million plus prejudgment interest of $791,153.48; (ii) El Capitan to disgorge ill-gotten gains of $10.7 million plus prejudgment interest of $1,840,291.82; and (iii) Nash to pay a civil penalty of $3,456,942.

The SEC’s investigation was conducted by William M. Rosenthal and supervised by Ansu N. Banerjee, both of the Los Angeles Regional Office, with the assistance of trial counsel Robert C. Stillwell under the supervision of Douglas M. Miller.