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HomenewsJudge Suspends Sec Action in Alleged Nj Deli Stock Scam in Lieu...

Judge Suspends Sec Action in Alleged Nj Deli Stock Scam in Lieu of Criminal Investigation

A federal judge has temporarily halted the Securities and Exchange Commission’s civil case concerning allegations of fraud involving a local New Jersey deli whose parent company was once worth $100 million on the stock market, at the request of the Justice Department.

Because of the substantial overlap between the SEC action and the federal prosecutors’ criminal litigation, they asked the judge to delay the SEC case earlier in December. The government contended that by delaying the civil action, it could “preserve the integrity” of the prosecution by preventing the defendants from seeing how extensive the government’s evidence is against them.

Judge pauses SEC case in alleged NJ deli stock fraud in favor of criminal probe

On Wednesday, Judge Christine O’Hearn approved their request after hearing no objections from the SEC or the defendants. When asked for a statement, the SEC said only that it would not go further what was already revealed in public records.

New Jersey prosecutors say they used the defunct sandwich restaurant Your Hometown Deli as a pawn in a global market manipulation scheme, and this decision is the latest chapter in the drama.
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James Patten, Peter Coker Sr., and Peter Coker Jr., three wealthy businessmen, owned and operated Hometown International.
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Their relationship is that of father and son.

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In September, prosecutors filed seven criminal counts against the individuals, alleging that they had inflated the valuations of Hometown International and another shell firm, E-Waste, through market manipulation.

On the same day that charges were announced, police apprehended Patten and Coker Sr.

, but Coker Jr., who now resides in Hong Kong, has not been located. On the same day, the SEC also disclosed its legal suit against the three men.

Though Hometown International is worth $100 million on the stock market, Your Hometown Deli only brought in around $40,000 in sales last year, according to SEC documents. In 2014, Paul Morina, principal and wrestling coach of Paulsboro High School, and his close friend Patten founded the deli.

Judge pauses SEC case in alleged NJ deli stock fraud in favor of criminal probe

Patten allegedly urged Morina to start the deli under the Hometown International brand, according to the prosecution. Prosecutors claim Patten and the Coker father-son combo “began presenting Hometown International as a vehicle for a reverse merger that would bring substantial benefit to them” without Morina’s knowledge.

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This month, prosecutors stated that they would evaluate around two batches of 80,000 papers each by January 27. On January 17th, the court will convene a status conference regarding these filings.

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