UNITED STATES OF AMERICA
Before the
SECURITIES AND EXCHANGE COMMISSION

Securities Exchange Act of 1934
Release No. 46813 / November 12, 2002

Accounting and Auditing Enforcement
Release No. 1660 / November 12, 2002

Administrative Proceeding
File No. 3-1660

I.

The Securities and Exchange Commission ("Commission") deems it in the public interest that public administrative proceedings be, and hereby are, instituted against Stephen R. Becker ("Becker") pursuant to Rule 102(e)(3) of the Commission's Rules of Practice.¹

II.

In anticipation of the institution of these proceedings, Becker has submitted an Offer of Settlement (the "Offer") which the Commission has determined to accept. Solely for the purpose of these proceedings and any other proceedings brought by or on behalf of the Commission, or to which the Commission is a party, and without admitting or denying the findings herein, except as to the Commission's jurisdiction over him and the subject matter of these proceedings, and the findings contained in Section III.3. below, which are admitted, Becker consents to the entry of this Order Instituting Administrative Proceedings Pursuant to Rule 102(e) of the Commission's Rules of Practice, Making Findings, and Imposing Remedial Sanctions ("Order"), as set forth below.

III.

On the basis of this Order and Becker's Offer, the Commission finds that:

Respondent

1. Stephen R. Becker, age 38, was a Regional Controller at EA Engineering, Science, and Technology, Inc. ("EA Engineering") from 1997 to October 1999, when he left the company. He resides in Timonium, Maryland. Becker is licensed by the State of Maryland as a certified public accountant and has maintained inactive status since January 1997.

Other Relevant Entity

2. EA Engineering was a Delaware corporation with its principal executive offices in Hunt Valley, Maryland. The company was primarily engaged in the business of energy, environmental, and health and safety consulting. At the time of the violative conduct discussed herein, EA Engineering's common stock was registered with the Commission pursuant to Section 12(g) of the Securities Exchange Act of 1934 ("Exchange Act") and traded on the NASDAQ National Market System. The company's fiscal year-end was August 31. In September 2001, EA Engineering was taken private pursuant to a management-led tender offer. Accordingly, EA Engineering is no longer a public company.

Background

3. By judgment of the United States District Court for the District of Columbia, Becker has been permanently enjoined, by consent, from violating Section 10(b) of the Exchange Act and Exchange Act Rules 10b-5 and 13b2-1 and from aiding and abetting violations of Sections 13(a) and 13(b)(2)(A) of the Exchange Act and Exchange Act Rules 12b-20, 13a-1, and 13a-13. The Court also ordered him to pay a civil penalty in the amount of $20,000. SEC v. Stephen R. Becker, Civil Action No. 02CV02126 (JDB) (D.D.C. November 1, 2002).

The Commission's complaint, filed on October 30, 2002, alleged, among other things, the following:

During EA Engineering's fiscal year ended August 31, 1999, in order to conceal project contract losses from EA Engineering managers who had emphasized the importance of the company making its projected earnings, the defendant Stephen R. Becker committed fraudulent acts by, among other things, intentionally recording fictitious revenue on the books of the company in the form of false unbilled receivables. Becker assigned the fictitious revenue to various projects, most of which were inactive. Becker moved the fictitious revenue among projects to keep the projects' unbilled receivables from aging and over-rode the company's contract accounting system so that the inactive project accounts would not be billed. As a direct result of Becker's actions, EA Engineering's financial statements included in its quarterly report on Form 10-Q for its quarter ended May 31, 1999, and its annual report on Form 10-K for its fiscal year ended August 31, 1999, were materially misstated. The financial statements for the quarter ended May 31, 1999, materially misstated and misrepresented the company's unbilled accounts receivable and the financial statements for the fiscal year ended August 31, 1999, materially misstated and misrepresented the company's unbilled accounts receivable and its loss before income taxes. By engaging in this conduct, Becker violated the antifraud and recordkeeping provisions of the federal securities laws. He also aided and abetted EA Engineering's violations of the periodic reporting and recordkeeping provisions of the federal securities laws.

IV.

In view of the foregoing, the Commission deems it in the public interest to impose the sanction agreed to in Respondent Becker's Offer.

Accordingly, IT IS HEREBY ORDERED that:

1. Becker is suspended from appearing or practicing before the Commission as an accountant.
    
2. After three years from the date of this order, Becker may request that the Commission consider his reinstatement by submitting an application (attention: Office of the Chief Accountant) to resume appearing or practicing before the Commission as:
    
1. a preparer or reviewer, or a person responsible for the preparation or review, of any public company's financial statements that are filed with the Commission. Such an application must satisfy the Commission that Becker's work in his practice before the Commission will be reviewed either by the independent audit committee of the public company for which he works or in some other acceptable manner, as long as he practices before the Commission in this capacity; and/or
    
2. an independent accountant. Such an application must satisfy the Commission that:
    

(a)	Becker, or the firm with which he is associated, is a member of the SEC Practice Section of the American Institute of Certified Public Accountants Division for CPA Firms ("SEC Practice Section") or an organization providing equivalent oversight and quality control functions ("equivalent organization");
(b)	Becker, or the firm, has received an unqualified report relating to his, or the firm's, most recent peer review conducted in accordance with the guidelines adopted by the SEC Practice Section or equivalent organization; and
(c)	As long as Becker appears or practices before the Commission as an independent accountant he will remain either a member of, or associated with a member firm of, the SEC Practice Section or equivalent organization, and will comply with all applicable SEC Practice Section or equivalent organization requirements, including all requirements for periodic peer reviews, concurring partner reviews, and continuing professional education.

3. The Commission will consider an application by Becker to resume appearing or practicing before the Commission provided that his state CPA license is current and he has resolved all other disciplinary issues with the applicable state boards of accountancy. However, if state licensure is dependant on reinstatement by the Commission, the Commission will consider an application on its other merits. The Commission's review may include consideration of, in addition to the matters referenced above, any other matters relating to Becker's character, integrity, professional conduct, or qualifications to appear or practice before the Commission.

By the Commission.

Jonathan G. Katz
Secretary

http://www.sec.gov/litigation/admin/34-46813.htm