Washington D.C., Sept. 26, 2022 —
The Securities and Exchange Commission today charged Peter L. Coker Sr., Peter L. Coker Jr., and James T. Patten for their roles in orchestrating fraudulent manipulative securities trading schemes. These schemes included artificially inflating the share price of Hometown International, which operated a New Jersey deli producing less than $40,000 in annual revenue, from approximately $1 per share in October 2019 to nearly $14 per share by April 2021, leading to a grossly inflated market capitalization of $100 million.
According to the SEC’s complaint, Patten, Coker Sr., and Coker Jr., who was the former Chairman of the Board of Hometown International, took control of the outstanding shares of Hometown International and a separate shell company, E-Waste Corp., artificially inflated the price of both issuers’ stock through manipulative trading, and used the entities to acquire privately-held companies in reverse mergers, with the intent to thereafter dump their shares at grossly inflated prices. Before the defendants were able to reap the intended profits of the schemes, as alleged, numerous news articles were published discussing the issuers’ inflated stock prices.
“We allege that the defendants’ brazen schemes resulted in the artificial inflation of the stock price of two publicly traded companies with little to no annual revenues,” said Scott A. Thompson, Associate Director of Enforcement in the Philadelphia Regional Office. “Such manipulative schemes diminish the trust investors must have in the integrity of the markets, and we will pursue those who engage in such wrongdoing.”
The SEC’s complaint, filed in the U.S. District Court for the District of New Jersey, charges all three defendants with violations of the antifraud provisions of the securities laws. The complaint also charges Patten with violating market manipulation provisions of the securities laws and charges Coker Sr. and Coker Jr. with aiding and abetting those violations. It seeks injunctive relief, disgorgement plus prejudgment interest, civil penalties, a prohibition against participating in any penny stock offerings, and an officer and director bar against Coker Jr.
In a parallel action, the U.S. Attorney’s Office for the District of New Jersey announced criminal charges against Patten, Coker Sr., and Coker Jr.
The SEC’s investigation, which is ongoing, is being conducted by Cecilia B. Connor of the Philadelphia Regional Office with assistance from Leigh Barrett from the Office of Investigative and Market Analytics. It is being supervised by Assunta Vivolo and Mr. Thompson. The SEC’s litigation will be handled by John V. Donnelly and supervised by Gregory R. Bockin. The SEC appreciates the assistance of the Federal Bureau of Investigation, the U.S. Attorney’s Office for the District of New Jersey, and the Financial Industry Regulatory Authority.
This news item was originally published by the US Securities and Exchange Commission (SEC US). For more information, see the Source Link.