Father and Son Admit to Inflating NJ Deli Stock in International Market Manipulation Scheme

The Paulsboro deli at the heart of a 939% stock inflation scandal becomes a cautionary tale of securities fraud.

A father-son duo behind an elaborate international market manipulation scheme involving two publicly traded companies, including a modest New Jersey deli, have pleaded guilty to securities fraud and conspiracy charges. Peter Coker Sr., 82, of Chapel Hill, North Carolina, and Peter Coker Jr., 56, formerly of Hong Kong, admitted their roles in the scheme during a hearing before U.S. District Judge Christine P. O’Hearn.

The Cokers orchestrated a years-long scheme to manipulate the stock prices of Hometown International Inc.—the parent company of a small deli in Paulsboro, NJ—and E-Waste Corp. Their actions inflated the deli’s stock value by a staggering 939% and E-Waste’s by 19,900%, according to U.S. Attorney Philip R. Sellinger.

A Modest Deli with Sky-High Valuations

The saga began in 2014 when two Paulsboro residents opened a local deli and formed Hometown International to operate it. However, unbeknownst to the owners, the Cokers and co-conspirator James Patten saw the corporation as an opportunity for a reverse merger—a process allowing private companies to merge with public entities to access public markets.

Around 2019, the Cokers and Patten took control of Hometown International, transferring millions of shares to nominees, including friends, family, and entities controlled by Coker Jr. They coordinated trading events, such as match and wash trades, to create the illusion of high demand for the stock.

Their manipulative tactics inflated Hometown International’s stock price and allowed the group to position the company as a lucrative merger target.

Artificially Inflating Stocks for Profit

The scheme extended to E-Waste Corp., a publicly traded shell company. The conspirators executed similar tactics to inflate its stock price nearly 200-fold. Their combined actions injected false information into the market, creating an illusion of legitimate market interest and driving up stock values.

By the time authorities intervened, the manipulation had impacted not only investors but also the integrity of public markets.

Legal Fallout

The Cokers now face significant penalties. Securities fraud carries a maximum sentence of 20 years in prison and a $5 million fine, while the conspiracy charge adds a potential five years and a $250,000 fine. Coker Jr. will be sentenced on April 2, 2025, with Coker Sr.’s sentencing set for May 13, 2025.

Co-defendant James Patten, 65, of Winston-Salem, North Carolina, previously pleaded guilty to the same charges.

Investigative Efforts and Prosecution

The FBI’s Philadelphia Division and IRS-Criminal Investigation, along with agents from FBI offices across the country, uncovered the scheme. Lauren E. Repole, Chief of the Economic Crimes Unit, and Assistant U.S. Attorney Aaron Webman are prosecuting the case.

A Wake-Up Call for Investors

The Hometown International case, with its bizarre juxtaposition of a small-town deli and inflated market valuations, underscores the risks of unchecked stock manipulation. While the Cokers sought to profit through deception, their guilty pleas bring closure to one of the most unusual securities fraud cases in recent memory.

This case serves as a stark reminder for investors to scrutinize seemingly inflated stock values and for regulators to remain vigilant against fraud in all its forms.