Peter Coker Sr. outside U.S. District Court in Newark, New Jersey, March 15, 2023.
Dan Mangan | CNBC
Peter Coker Jr., left, is issued search warrants from police at his villa on the southern resort island of Phuket, Thailand, Jan. 11, 2023.
Crime Suppression Division, Royal Thai Police | AP
A third defendant, James Patten, pleaded guilty in December 2023 to the same charges of securities fraud and conspiracy to commit securities fraud in connection with the company once known as Hometown International and another firm.
Lawyers for the Cokers reached a deal with federal prosecutors that stipulates neither side will argue for more or less than a range of prison time at sentencing for both men. That agreement does not bind the judge to deliver sentences within those ranges.
For the 82-year-old Coker Sr., the range is zero to two years in prison. For his 56-year-old son, the range is 30 months to 50 months.
The Cokers and Patten each admitted their roles in the scheme to artificially boost the stock price of Hometown, whose only real business asset was the Your Hometown Deli in Paulsboro, as well as the shares of a shell company then known as E-Waste.
Hometown’s stock price rose by more than 900% as a result of the scheme. The price of E-Waste rose by nearly 20,000%.
The scam, which ran from 2014 through September 2022, involved coordinated trading of the stocks of both companies, creating a false impression of demand for their shares, which traded on OTC Marketplace.
The defendants during the conspiracy gained control of the companies’ management and shares, with the aim of using them as vehicles for reverse mergers with privately held companies. Both companies ended up being merged in such deals with private firms.
Coker Sr., who lives in Chapel Hill, North Carolina, has been free on bond since his arrest in September 2022. He is scheduled to be sentenced on May 13.
Zach Intrater, an attorney for the elder Coker, declined to comment on his guilty plea.
Coker Jr., a former Hong Kong resident, has been held without bail in the Essex County, New Jersey, jail since he was extradited from Thailand in March 2023. He is scheduled to be sentenced on April 2.
John Azzarello, a lawyer for Coker Jr., told CNBC, “He admitted to the fact that he held a large volume of stock in both companies in the names of [firms] that he controlled that were not in his name, and he admitted that he participated in the conspiracy to artificially inflate the prices of the stocks.”
Azzarello said Coker Jr. has been jailed “under really, really tough conditions” in New Jersey, and “under deplorable conditions” for two months before that in a Thai prison after his arrest there.
“He’s very anxious to go forward to sentencing and put this behind him and go back to Asia where he built his career and his life since graduating college,” Azzarello said. “We are hopeful that we can convince the court that the appropriate sentence is at the bottom end of the agreement.”
In 2010, Patten pleaded guilty in New Jersey federal court to mail fraud, which was related to sending a client a false financial statement to cover up bad investments he made using her money. He was sentenced to 27 months in prison in that case.
Read the original article here