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A felon who stuck more than a thousand homeowners in Arizona and California with bogus liens as part of a credit-collection scam has been sentenced to 10 years in prison. How Jeff McCoon ended up behind bars has less to do with the liens he filed than a set of circumstances that took seven years to play out. McCoon, 47, orchestrated a financial scheme in 2006 to force homeowners to pay debts that in many cases they didn’t owe by filing liens against their homes.

An investigation by The Arizona Republic eight years ago showed that McCoon, through Pacific States Credit Co., filed more than 600 such liens in Maricopa, Pima and Pinal counties, as well as hundreds more in California. To get the liens lifted, homeowners were told they must pay credit-card debts that in many cases had been paid, written off in bankruptcies or weren’t actually owed.

Liens, which can ruin credit and prevent owners from selling or refinancing, cloud title to property. Someone trying to sell or refinance a house is often required to pay off a lien before the transaction can be completed. Liens are traditionally filed in cases in which real estate was used as collateral but can also be filed against homeowners for failure to pay income taxes and by contractors who are owed money for work on a home.

McCoon, however, filed liens based a type of debt rarely secured by real estate. County records, court documents and letters from Pacific States showed that McCoon filed liens and then demanded payment for credit-card debt, along with payments for penalties and interest.

McCoon filed the liens through county recorders’ offices, which have no authority to determine if liens are legitimate; they simply record the liens. McCoon followed the liens with threats of litigation, and, in at least one Arizona case, convinced someone to sign over the deed to his house.

Arizona authorities took no action against McCoon. But California did. Court records in Orange County, Calif., show that McCoon sent demand letters to escrow officers, offering to release the liens upon payment via wire transfer into his bank account. He also sent homeowners documents titled “summons and complaint,” along with copies of the liens, giving some the impression that they were being sued. But records showed the summons were not filed with the court. The Orange County District Attorney’s Office in 2006 filed charges against him on 148 felony counts of attempted extortion, forgery and filing false documents.

Phoenix private investigator John Brewington, who tracked McCoon’s activities eight years ago, said the California case languished for years and ended in 2013 when authorities dismissed all but one charge and allowed McCoon to plead guilty.

“Outrageous, you say?” Brewington recently wrote in a blog about the case. “He got probation for that charge. … Sad.”

McCoon was not off the hook, however. Before opening shop as a debt collector in California, McCoon had lived in Colorado, where he was convicted of fraud in 1996 for bilking $475,000 out of several businesses. He was given 14 years probation and was required to repay the money.
In 2006, Colorado authorities issued a warrant for his arrest for failure to make restitution. After his guilty plea in California, Colorado authorities arrested McCoon, revoked his probation and sentenced him to 10 years in prison.
That may be little solace for Valley residents such as Joe Peck, who signed over his modest Chandler house to McCoon in 2006.
Peck said McCoon contacted him in 2004 over charges on a Providian Visa card that Peck had stopped making payments on in 2001. Although the original debt was for $2,600, McCoon demanded $7,000 in penalties and interest.

“I begged him not to take my house. I told him, ‘My daughter was born in this house,’ ” Peck said in an interview at the time. “He offered to put me on a payment plan.”

To qualify for McCoon’s payment plan, Peck said he had to sign the documents McCoon provided him, one of which was a deed to his house. A year later, Peck filed bankruptcy and stopped paying McCoon. Pacific States initiated foreclosure. “(McCoon) said, ‘That paper you signed says you can’t file bankruptcy, and you still owe me,’ ” Peck said. “He said I signed away the rights to my house and he was going to take it.”

Peck said his bankruptcy included the Providian Visa credit card, which was not secured by real estate. Instead of fighting McCoon, Peck deeded his house to a real-estate agent who agreed to assume the mortgage and pay off Pacific States.

“(McCoon) got $7,000, and I lost my house,” Peck said. Colorado prison records show McCoon will be in custody until at least 2018, when he is eligible for parole.

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