US SEC charges three with fraudulently manipulating securities News
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US SEC charges three with fraudulently manipulating securities

The Securities and Exchange Commission (SEC) Monday charged three men for their roles “in orchestrating fraudulent manipulative securities trading schemes” which resulted in a $100 million valuation for a New Jersey deli and a $120 million valuation for a separate shell company.

The SEC’s complaint states that Peter L. Coker Sr., Peter L. Coker Jr. and James T. Patten “took control of the issued and outstanding shares” of Hometown International, Inc. and EZRaider Co., a shell company formerly known as E-Waste Corp. The SEC alleges that the defendants’ schemes “inflated the price of these companies’ stock through manipulative trading that Defendants executed through affiliated and nominee accounts they controlled, often using the same IP addresses to execute the trades.” Defendants generated “the false appearance of active trading and a rising price for the security.”

Defendants’ fradulent activity “produced a market capitalization of approximately $100 million for a single-store deli” owned by Hometown International. Defendants’ shell company had no revenue but was valued at approximately $120 million. Scott A. Thompson, Associate Director of Enforcement in the Philadelphia Regional Office, stated that such “manipulative schemes diminish the trust investors must have in the integrity of the markets.”

The SEC believes all three defendants profited from the scheme and caused innocent investors to suffer after they “purchased the stock of Hometown International and E-Waste Corp. at artificially inflated prices” as a result of the defendants’ market manipulation.