A federal judge has ruled that the individuals behind one of the most notorious microcap fraud schemes in recent memory, the New Jersey deli scandal, have failed to pay the millions of dollars in restitution they owe. The case, centered on Hometown International, once valued at nearly $100 million despite owning a small, loss-making deli, became symbolic of the excesses and vulnerabilities of lightly regulated over-the-counter markets.

Court filings show that Peter Coker Sr., one of the principal defendants, has not paid the restitution required under the terms of his conviction. Prosecutors argued that Coker and his co-defendants artificially inflated the company’s stock price through coordinated trades and deceptive control structures, misleading investors about the firm’s value and prospects.

The sentencing judge noted that the unpaid restitution underscores ongoing concerns about accountability in securities fraud cases, particularly when defendants move assets or obscure financial records. Authorities warned that failing to meet restitution obligations can trigger additional penalties, including potential extensions of supervised release or further financial enforcement actions.

Hometown International gained international attention in 2021 after regulators flagged glaring discrepancies between its valuation and its actual operations. Investigators later uncovered a web of manipulations designed to make the stock appear active and valuable, allowing insiders to profit from inflated prices.

The continued failure to repay investors adds a fresh layer of scrutiny to the saga, amplifying long-standing questions about oversight in U.S. microcap markets and the difficulty of recovering funds once fraud schemes unravel.