A federal judge has ordered a Santa Barbara investment advisor who specialized in managing the cash holdings of large cannabis companies to return $15.3 million in misappropriated funds, some of which he used to buy a house in Hope Ranch. Andrew Nash, principal of El Capitan Advisors, must also pay $6.1 million in interest and penalties and is permanently barred from working in finance, the judge ruled.
Nash was the subject of a Security and Exchange Commission (SEC) complaint filed earlier this month that accused him of transferring money out of client accounts and spending “a large portion on himself, using $4.6 million to purchase a home.” A court filing reads, “the clarity of the fraudulent conduct on the part of Mr. Nash to cover-up the transaction cannot be understated.”
The SEC explained how “Nash took extensive efforts to conceal his appropriation” by providing false financial statements to clients and lying to federal regulators. “For example,” the complaint says, “El Capitan Advisors reported in 2023 that it had over $7.4 billion in assets under management” when in reality the total was less than $62 million. Nash did not respond to multiple requests for comment.
During a search of Nash’s Santa Barbara office, which he had rekeyed in an attempt to thwart any seizures, authorities found what they described as hundreds of thousands of dollars worth of sports memorabilia in its original packaging. Around this time, Nash’s wife, who had originally been named as a co-defendant in the SEC complaint, filed for divorce and began cooperating with officials.
The bulk of the stolen funds came from Planet 13 Holdings Inc., a publicly traded cannabis company with operations in California, Nevada, Illinois, and Florida. Its Las Vegas dispensary, at 112,000 square feet, is the largest in the world. In a statement to shareholders, Planet 13 said the company would “pursue recovery of its funds through all legally available means, including as appropriate, through cooperation with law enforcement.”
Nash has also been sued by Casa Verde Capital, a cannabis venture capital firm cofounded by rap artist Snoop Dogg that provided El Capitan with its first $1 million in seed money. Casa Verde claimed Nash reneged on a $35 million credit agreement and is now enmeshed in its own litigation with Planet 13 to recover its share of the commingled funds.
The proceedings against Nash have so far played out in civil court, and he has yet to be charged with any crimes. Federal prosecutors are currently determining if they will initiate a criminal case against him, or if the responsibility will fall to the Santa Barbara County District Attorney’s Office.
Nash, 48, is originally from Texas and spent 16 years in commercial real estate brokerage before establishing El Capitan Advisors and registering it with the SEC in 2019. The firm attracted cannabis clients looking to secure and invest their cash proceeds without running afoul of federal law.
Because El Capitan was a registered advisor and not a financial institution, it was not bound by certain anti-money laundering and “know your customer” regulations and could therefore accept deposits from cannabis companies without triggering federal reporting requirements.
Meanwhile, Nash was also attempting to raise $82 million to buy a bank in Oakland and obtain a banking license for use by California cannabis companies. In order to win approval from the Federal Deposit Insurance Commission (FDIC), he had to identify legitimate business partners and prove a viable business plan.
Though El Capitan did secure some of the needed capital, it began to fall short, and Nash became desperate. He started personally guaranteeing the deal would go through, writing to one potential investor: “FYI I am liquidating my personal funds I have set aside for my son’s kidney transplant and will use those funds if I have to.” The FDIC ultimately rejected Nash’s application.
It was around this time that Nash and his family were invited to attend the signing of an executive order by President Donald Trump to improve the treatment of kidney disease in the United States.
Shortly after the collapse of El Capitan Advisors, Santa Barbara police responded to a welfare check at a motel where Nash was staying. They found him intoxicated and in possession of a loaded gun. His family said he had many more at home. A judge approved a petition to seize the firearms, and Nash is prohibited from using or owning one until 2028.
