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Peter Coker Sr., 82, of Chapel Hill, North Carolina, and his son, Peter Coker Jr., 56, pleaded guilty on Thursday, Dec. 19 to securities fraud and conspiracy to commit securities fraud, New Jersey's U.S. Attorney Philip Sellinger said in a news release. Coker Jr. is a former resident of Hong Kong.
Prosecutors said the plan started around 2014 when two New Jersey residents opened Your Hometown Deli on Mantua Avenue. The pair sought help from a longtime friend, 65-year-old James Patten of Winston-Salem, NC.
Patten helped the two set up an umbrella corporation called Hometown International Inc. to oversee the deli’s operations. The deli owners were unaware that Patten and his associates used Hometown International for a reverse merger to earn a large profit.
By 2019, Hometown International shares started trading on the OTC Marketplace, an alternative trading system. While the deli was serving up sandwiches and snacks, Patten and the Cokers were busy manipulating its stock behind the scenes.
Investigators said the trio used shady tactics like transferring shares to fake entities and staging coordinated trades to make it look like the company’s stock was in high demand. As a result, Hometown International’s stock price soared by 939 percent—despite the deli only making a few thousand dollars in annual revenue.
The Cokers and Patten used the same tricks to inflate the stock of another company called E-Waste Corp., which saw its value skyrocket by about 19,900 percent. The scheme's goal was to use the two companies for reverse mergers, allowing private companies to go public and cash in big.
The scam unraveled after years of inflating the companies' stock and misleading investors. Prosecutors called the scheme a "calculated scheme" to manipulate the market and enrich the group at the expense of others.
Patten and Coker Sr. were arrested in September 2022. Coker Jr. was captured as a fugitive in Thailand in January 2023, the Bangkok Post reported.
Patten previously pleaded guilty to the same offenses as the Cokers did. The three faced up to 20 years in prison and $5 million fines for the securities fraud charges.
Coker Jr.'s sentencing was set for Wednesday, Apr. 2, 2025, while his father's sentencing was scheduled for Tuesday, May 13, 2025.
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