Steeplefall was originally a pagan town, until some visitors discovered silver in the mountains. The miners eventually hired mercenaries to drive out the pagans. Although they were successful, the mercenaries then formed a band called the Black Silk Traders under the leadership of Dead-Eye Grim, a half-orc ranger. Grim led the Traders for many years, then disappeared, leaving his brother (a barbarian) and his second-in-command (a swordmage) to lead.
In the meantime, the miners created the town of Steepleton, under the guidance of a cleric of Pelor. He worked with the Traders, telling the townspeople they were a necessary evil and had always treated the town fairly, regardless of their interactions with others.
In reality, the priest was a servant of Asmodeus and sought to enslave the town under his rule. He was successful for many years until Crogwen returned with his tribe to overthrow Steepleton. The priest was killed in battle, his treachery undiscovered seemingly forever.
Asmodeus’ followers under the mountain took notice of this and began to raid Steeplefall, as it had been named by those who came to trade.