Ep.123 Real Conversations: Steve Clapham, Founder, Behind the Balance Sheet → How to Spot the Next Big Fraud

Mar 28, 2025

Steve Clapham, a forensic accounting expert with over 30 years of experience, shares insights on identifying financial fraud. He discusses the alarming rise in earnings manipulation and the challenges of short selling in a deceptive market. Clapham emphasizes the importance of deep financial analysis over quick speculation and critiques the limitations of traditional training for analysts. He also explores high-profile fraud cases like Greensill and highlights the disconnect between reported figures and actual performance, urging investors to prioritize thorough research.

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ANECDOTE

Ageism in Finance

Steve Clapham applied to 47 finance jobs in London but got zero interviews, likely due to his age.
This led him to start his own successful training business, teaching forensic accounting.

INSIGHT

Short Selling Frauds

Short selling frauds is difficult, as fraudsters are often credible and persuasive.
Wait for market cracks and external shocks before shorting, as timing is crucial.

ADVICE

Read the 10K

Prioritize reading the 10K yourself.
Don't solely rely on sell-side research or summaries.

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***This webcast originally aired live on Hedgeye.com on March 28th, 2025***

Join Hedgeye CEO Keith McCullough for a new Real Conversation with Steve Clapham on March 28 at 11:00am ET. A forensic accounting expert, author and former hedge fund research partner, Steve has spent over 30 years analyzing financial statements—and he’s never seen more earnings manipulation than today.

They’ll cover:

✅ Forensic Accounting Secrets – Why most investors misread financials and how to gain an edge.
✅ The Shift in Active Investing – How hedge funds are adapting while long-only funds struggle.
✅ Biggest Frauds & Market Risks – Lessons from major scandals like Greensill and what’s lurking now.

Steve’s bestselling book and elite training programs have helped investors sharpen their research skills. Don’t miss this deep dive into financial sleuthing, market trends, and investing discipline.

Visit Hedgeye.com for more great investing content.

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