Stephen G. Stroup

Counsel Philadelphia
stephen.stroup dbr.com
Phone: (215) 988-2547
Fax: (215) 988-2757

About

Stephen G. Stroup has substantial experience in securities and corporate governance litigation, white collar criminal defense and corporate investigations, and complex business disputes, with a particular emphasis on Securities and Exchange Commission (SEC) enforcement proceedings and private actions involving accounting and financial issues. Steve is counsel in the firm’s Litigation Practice Group.

He has a proven track record of obtaining optimal results for his clients, both at trial and during the pre-trial and investigatory stages. In addition to the numerous instances in which his clients have never been charged with any criminal or regulatory violation, Steve recently obtained a full dismissal of a securities class action complaint for a publicly-traded pharmaceutical company and its chief executive officer. Steve’s successes also include a full acquittal for a corporate and securities attorney charged in a 25-count Indictment involving conspiracies to commit securities fraud and wire fraud, and exceptional settlement concessions from the SEC on behalf of a “Big Four” audit partner in an SEC enforcement action.

Steve is a contributor to the firm's SEC Law Perspectives Blog, which provides reports, discussions, and analyses on noteworthy trends in enforcement and regulatory activity of the U.S. Securities and Exchange Commission (SEC) and other agencies, such as the U.S. Commodity Futures Trading Commission (CFTC).

Steve is a certified public accountant and a certified fraud examiner with considerable experience in the accounting and auditing professions. His dual background in law and accounting provides him with a unique perspective and advantage when deciphering facts and evaluating sophisticated legal matters. Steve has also written numerous articles on emerging trends in SEC enforcement, corporate governance and white collar criminal defense.

Before entering private practice, he served as a judicial clerk for the Hon. Joseph D. O’Keefe in the Court of Common Pleas, Philadelphia County.

Experience

  • A “Big Four” audit engagement partner in an enforcement action under Section 10(b) of the Exchange Act involving purchase price adjustments, bad debt reserves and intercompany transfers.
  • A regional bank holding company in a formal investigation pertaining to the adequacy of its accounting for loan and lease losses and other-than-temporarily impaired investments, and the sufficiency of its internal control environment.
  • A vice president of a major, nationally-recognized broker-dealer in a parallel SEC and USAO securities fraud investigation concerning “market timing” activities in the mutual fund industry.
  • A major, national accounting firm in a formal investigation involving the valuation and disclosure of thinly-traded, investment-related assets by a hedge fund client.
  • The managing partner of a hedge fund in an enforcement action under Section 10(b) of the Exchange Act relating to investment “churning” and “soft dollar” relationships.
  • A “Big Four” accounting firm in a formal investigation pertaining to the sufficiency of entity-level internal controls and the timing and accuracy of revenue recognition by a publicly-traded client.
  • A limited partnership named as a relief defendant in an enforcement action under Section 10(b) of the Exchange Act and Section 17 of the Securities Act involving a "Ponzi scheme" and other misappropriations of investor funds.
  • A broker-dealer in a formal investigation centered on the adequacy of financial disclosures pertaining to pharmaceutical research and development-based projections.
  • A publicly-traded pharmaceutical company and its CEO in a class action under Sections 10(b) and 20(a) challenging the material adequacy of disclosures relating to the design and conduct of the company’s clinical drug trials.
  • The former chief financial officer of a publicly-traded real estate investment trust (REIT) in a shareholder class action alleging securities fraud and related claims under Sections 10(b) and 20(a) of the Exchange Act and Sections 11 and 15 under the Securities Act, and involving the capitalization of various business-related costs.
  • An office managing partner of a major national accounting firm, who served as the concurring partner on a purportedly deficient audit, in a Public Company Accounting Oversight Board (PCAOB) investigation, concerning alleged workpaper violations under both PCAOB standards and generally accepted auditing standards (GAAS).
  • A former director of a publicly-traded international health care financing company in a shareholder and bondholder class action alleging securities fraud and related claims under Sections 10(b) and 20(a) of the Exchange Act involving numerous alleged accounting irregularities.
  • A state insurance commissioner, as statutory receiver for an insolvent insurer, prosecuting claims relating to the valuation and risk of collateralized mortgage obligations (CMOs) and other mortgage backed securities against two internationally-renowned investment advisory firms.
  • A corporate and securities law partner, who represented a diversified publicly-traded company, in a 25-count Indictment alleging conspiracies to commit securities fraud and wire fraud in connection with financial statement disclosures and business acquisitions.
  • The Special Committee of a Fortune 100 company in response to a governmental investigation concerning whether service contracts with the federal government complied with “most favored nation” pricing requirements.
  • The Special Committee of a bank holding company in response to shareholder allegations regarding numerous alleged breaches of fiduciary duty and financial misappropriations by the chief executive officer and chairman of the board.

Credentials

Bar Admissions

  • New Jersey
  • Pennsylvania

Education

  • Widener University School of Law, B.S., 1998, cum laude, The Delaware Journal of Corporate Law
  • Lehigh University, 1989

Court Admissions

  • U.S. Court of Appeals, Third Circuit
  • U.S. District Court, District of New Jersey
  • U.S. District Court, Eastern District of Pennsylvania

Organizations

  • American Association of Certified Fraud Examiners
  • American Bar Association
  • Metropolitan Area Neighborhood Nutrition Alliance (MANNA), Director and Treasurer
  • Philadelphia Bar Association, Securities Regulation Committee