Stephen G. Stroup

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

About

Stephen G. Stroup has substantial experience in securities and corporate governance litigation, complex business disputes and corporate investigations, with a particular emphasis on Securities and Exchange Commission (SEC) enforcement proceedings and private actions involving accounting and financial issues.

Steve has a proven track record of obtaining optimal results for his clients, both at trial and during the pre-trial and investigatory stages. He recently obtained a full dismissal of a securities class action complaint for a publicly-traded pharmaceutical company and its chief executive officer. Other successes include a full acquittal for a corporate and securities attorney charged with 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 certified public accountant and a certified fraud examiner with considerable experience in the accounting and auditing professions prior to entering the law. This dual background in law and accounting offers his clients a unique perspective and advantage when deciphering facts and evaluating sophisticated legal matters.

Steve has also written many articles on emerging trends in SEC enforcement and corporate governance, and is a frequent 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.

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.
  • A large, national accounting firm in a fraud and professional negligence action involving the valuation of illiquid investments on a private equity fund’s financial statements.
  • 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.
  • A partner from an international accounting firm 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.
  • A Fortune 500 company in response to an SEC inquiry concerning the material adequacy of product warranty reserves and related disclosures in numerous public filings.
  • The Special Committee of a regional bank holding company in response to shareholder allegations of misleading voting protocols for the approval of amendments to the company’s articles of incorporation.
  • The Special Committee of a real estate investment trust resulting from an outside auditor inquiry about possible undisclosed related party transaction involving a corporate director.
  • The Special Committee of a bank holding company in response to whistleblower 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, J.D., 1998, cum laude, The Delaware Journal of Corporate Law
  • Lehigh University, B.S., 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, Law and Accounting Committee
  • Lehigh Lawyers Association
  • Metropolitan Area Neighborhood Nutrition Alliance (MANNA)