SEC v. Andrew Daniel Nash, El Capitan Advisors, Inc. — U.S. Securities and Exchange Commission Litigation Release No. 26327, dated June 17, 2025.
An investment adviser and its principal were charged with misappropriating $15.3 million from a client. The adviser allegedly transferred client funds for personal use, including buying a home, and fabricated account statements to hide the theft. They also allegedly overstated the firm's assets under management in filings with the SEC.
In Plain English
Imagine you hired someone to watch over your piggy bank. Instead of keeping it safe, they secretly took out $15.3 million! They even made fake notes to pretend the money was still there and told others their piggy bank was much bigger than it really was. Now, the government is stepping in to get the money back and stop them from doing it again.
Disclaimer: all facts are drawn from the SEC's own filings; the claims described are allegations unless and until a court rules or the parties settle, and some cases end in dismissal.
How the Alleged Scheme Worked
- Agreement for Cash Management In June 2021, El Capitan Advisors, Inc. (ECA) and its principal, Andrew Daniel Nash, agreed to provide cash management services for a public company client (Client A). Client A entrusted tens of millions of dollars to ECA for safekeeping and management.
- Misappropriation Begins Between June 2022 and March 2023, Nash began transferring funds from Client A's accounts. He moved over $15 million out of the accounts without authorization.
- Personal Use of Funds Nash used a significant portion of the stolen money for personal benefit, including purchasing a $4.6 million home in Santa Barbara, California.
- Fabricating Account Statements To conceal the theft, Nash created and sent fake monthly account statements to Client A. These fabricated documents falsely showed that Client A's money was still held at the financial institutions.
- Deceptive Transaction Example In March 2023, Nash recommended Client A authorize an $8 million investment. After Client A approved, Nash sent fabricated statements confirming the transaction, but he never actually made the investment as represented and instead made an unauthorized $1 million transfer.
- Overstating Assets Under Management Nash also filed false Form ADV reports with the SEC. For example, in 2022, ECA reported over $3.6 billion in assets under management, and in 2023, reported over $7.4 billion, when actual assets were significantly lower (less than $62 million in 2022 and less than $85 million in 2023).
- Total Funds Misappropriated By March 2023, the total amount misappropriated from Client A reached $15.3 million, encompassing the funds used for the home purchase and other unauthorized transfers.
The Enforcement Action
On June 11, 2025, the SEC obtained final judgments against El Capitan Advisors, Inc. and its principal, Andrew Daniel Nash. The judgments permanently enjoin them from violating Sections 206(1), 206(2), and 207 of the Investment Advisers Act of 1940. Nash was ordered to disgorge $4.6 million plus prejudgment interest of $791,153.48 and pay a civil penalty of $3,456,942. El Capitan was ordered to disgorge $10.7 million plus prejudgment interest of $1,840,291.82. Nash and El Capitan consented to the judgments without admitting or denying the allegations.
Named in this action: Andrew Daniel Nash, El Capitan Advisors, Inc..