Father and Son Admit to Stock Inflation at NJ Deli
A cautionary tale of securities fraud has emerged from a small deli in Paulsboro, NJ, where a father-son duo admitted to manipulating stock prices in an elaborate international scheme. Peter Coker Sr., 82, and Peter Coker Jr., 56, pleaded guilty to securities fraud and conspiracy charges before U.S. District Judge Christine P. O’Hearn.
The Cokers orchestrated a complex plan to inflate the stock prices of Hometown International Inc., the parent company of the deli, and E-Waste Corp. Their actions led to a staggering 939% increase in the deli’s stock value and a 19,900% rise in E-Waste’s value, according to U.S. Attorney Philip R. Sellinger.
The story began in 2014 when two local residents opened a deli in Paulsboro and formed Hometown International. Unbeknownst to them, the Cokers and their co-conspirator, James Patten, saw an opportunity for a reverse merger, where private companies merge with public entities to access public markets.
By 2019, the Cokers and Patten had taken control of Hometown International, transferring millions of shares to nominees, including friends, family, and entities controlled by Coker Jr. They engaged in trading events to create artificial demand for the stock, leading to inflated stock prices and positioning the company as an attractive merger target.
Their manipulative strategies also extended to E-Waste Corp., a publicly traded shell company, where they inflated the stock price nearly 200-fold. These actions injected false information into the market, deceiving investors and compromising the integrity of public markets.
The legal consequences for the Cokers are significant, with securities fraud carrying a maximum sentence of 20 years in prison and a $5 million fine. The conspiracy charge adds a potential five years and a $250,000 fine. Co-defendant James Patten has already pleaded guilty to the same charges.
The FBI, IRS-Criminal Investigation, and FBI offices nationwide worked together to uncover the scheme. The case highlights the risks of unchecked stock manipulation and the importance of investors scrutinizing inflated stock values and regulators remaining vigilant against fraud.
