Ocwen Vows To Fight Regulatory Actions Brought By CFPB
Taking a page from the PHH Mortgage regulatory defense playbook, mortgage servicer Ocwen Financial Corp. is seeking to have a complaint from the Consumer Financial Protection Bureau (CFPB) tossed on the grounds that the CFPB’s leadership structure is unconstitutional.
The mortgage servicer recently filed two related motions in U.S. District Court, Southern District Of Florida, West Palm Beach Division, seeking an early court ruling that because the bureau’s leadership structure is unconstitutional, the complaint should be dismissed.
In a statement, Ocwen officials say they believe the CFPB is unconstitutionally structured because its director has “too much unfettered power” and has little to no oversight by the president and by Congress.
In the PHH Mortgage case, a panel of three judges on the D.C. Circuit Court of Appeals recently found that the CFPB is unconstitutionally structured – a decision that is now being reviewed by the entire D.C. Circuit Court of Appeals. In that case, the U.S. Department of Justice (DOJ) recently filed a brief that stated its agreement with the panel decision – that the CFPB is unconstitutional for this reason.
Ocwen officials say they have informed the circuit court and the DOJ that the company intends to directly challenge the CFPB’s constitutionality at the earliest-possible opportunity.
Ocwen’s filings ask the court for a case management conference to discuss how the parties can get to that issue first, before any other proceedings in the case.
Ocwen has also filed a separate motion specifically asking the court to invite the DOJ to participate in the case so the court can consider fully the U.S. Attorney General’s conclusion that the CFPB is unconstitutionally structured.
In April, the CFPB filed its complaint against Ocwen alleging the company and its subsidiaries failed borrowers “at every stage of the mortgage servicing process.” The bureau has not yet announced any fines because it is still trying to determine the scope of the alleged improprieties.
The bureau alleges that “years of widespread errors, shortcuts and runarounds” on behalf of the servicer “cost some borrowers money and others their homes.”
More specifically, the bureau alleges Ocwen “botched basic functions like sending accurate monthly statements, properly crediting payments, and handling taxes and insurance.” It also alleges the servicer “illegally foreclosed on struggling borrowers, ignored customer complaints and sold off the servicing rights to loans without fully disclosing the mistakes it made in borrowers’ records.”
In addition to the CFPB’s complaint, more than 20 states have filed their own individual suits against the mortgage servicer, which is one of the largest in the nation, most in connection with alleged errors with homeowners’ escrow accounts. Some of those states have temporarily restricted Ocwen’s activities, and some have even gone so far as to prevent the servicer from operating at all – at least until its alleged problems have been addressed.
Ocwen has vowed to fight the state regulators’ accusations, announcing that it has filed two emergency motions requesting immediate court action restraining the cease and desist orders brought by the Illinois Department of Financial and Professional Regulation, the Division of Banking, and the Commissioner of Banks of the Massachusetts Division of Banks.
“As with the recent CFPB enforcement action, Ocwen strongly disputes the key allegations made in the state regulators’ cease and desist orders that Ocwen’s mortgage loan servicing practices have caused substantial consumer harm,” company officials say in a separate statement. “Ocwen will not sign unfair and unjust consent orders that make impractical demands that no other market participant could rationally accept and which would harm consumers. Under these circumstances, Ocwen has a responsibility to its customers, shareholders and employees to vigorously defend the company against unfounded claims while continuing to work with state regulators to resolve any valid concerns.”
Keith Noreika To Serve As Acting Comptroller Of The Currency, Replaces Thomas Curry
Keith A. Noreika is the new acting comptroller of the currency, filling in for former Comptroller of the Currency Thomas J. Curry, who left the position on May 5.
“Serving as comptroller of the currency has been the highlight of my career,” Curry says in a release. “The comptroller is a special job, and I am proud to have served with 4,000 men and women who showed such deep dedication to the agency’s mission of ensuring the safety and soundness of the federal banking system and the fair treatment of its customers.”
Curry, who completed his five-year term on April 9, plans to return home to Boston, according to the release.
Noreika is currently a partner at Simpson Thacher & Bartlett LLP and was a partner at Covington & Burling, specializing in banking regulation. He has extensive experience advising regional, multinational and other banks on structuring their operations, including compliance with the Volcker Rule and Consumer Financial Protection Bureau regulations, as well as the Bank Secrecy Act and anti-money laundering rules.
Noreika has represented national banks before the Supreme Court and has worked extensively with all federal bank regulatory agencies. He has also served as an adjunct faculty member at the University of Pennsylvania Law School and the University of Virginia School of Law.
HCL Technologies Buying Urban Fulfillment Services For About $30 Million
In a move that will strengthen its capabilities in mortgage BPO services, loan fulfillment and debt servicing, HCL Technologies, a global IT services company, has acquired Urban Fulfillment Services (UFS), a provider of mortgage business process and fulfillment services, for about $30 million in cash.
Founded in 2002, UFS employs more than 350 skilled professionals and operates out of three centers in the U.S. The transaction is still subject to the usual regulatory approvals.
In a release, Anoop Tiwari, corporate vice president and global head of business services for HCL Technologies, says, “Combining UFS’ talent and client portfolio with HCL’s deep industry expertise and business acumen offers us the unique opportunity to provide platform-based services on our own platform, driving transformation through robotics process automation.”
“The synergies between UFS’ client-focused and efficient business processing services and HCL’s technology leadership and financial strength will create an unparalleled competitor and leading provider of state-of-the-art services to the enterprise customers,” adds Charles S. Sanders, CEO of Urban Lending Solutions, of which UFS was a subsidiary.
UFS last made news in Servicing Management in August 2015 when it was reported that it was closing three locations in Colorado, including two serving the company’s underwriting department and one serving its GreenTree mortgage department.
An article in the Denver Post, citing a WARN notice filed with the Colorado Department of Labor and Employment, said the company would lay off approximately 265 workers across the three locations.
Part of the reason for the cuts, the company said at the time, was the reduced need for default servicing.
LenderLive Adds New Management To Its Settlement Services Division
Mortgage industry professionals David Tiberio and George Schultz have joined LenderLive, a national mortgage services provider, each as a vice president of national sales for the company’s settlement services line of business.
Schultz has more than two decades of mortgage industry experience. Previously, he was vice president of business development and client management for Kensington Vanguard National Land Title, where he was responsible for building out national client lists to help diversify the company’s clientele to include developers, builders, attorneys, Realtors, lenders, private equity funds, REITs and investors.
Before that, he spent 20 years with Title Resource Group, a Realogy Company, with roles in sales, vendor management and client management, and most recently as vice president of national operations, in which he was responsible for client expectations, contracts, profitability, and the global execution of company goals for Fortune 100 investment and retail banking clients.
Tiberio has more than 25 years of experience in the financial services, mortgage and real estate industries. He has held a series of senior positions at large national mortgage companies and title agencies, including First American Title Insurance Co. and Bank of America.
During his time at First American, Tiberio’s responsibilities included business development and selling title and settlement services for loss mitigation through real estate owned (REO) stages of default management, asset management, technology solutions and valuations.
Prior to First American, Tiberio spent 10 years in finance and mortgage servicing operations with Bank of America, where he managed the disposition of the bank’s REO inventory. Earlier in his career at Bank of America, he was an operations support manager for mortgage fulfillment.
In their new roles, Schultz and Tiberio will be responsible for developing new client relationships and supporting existing ones for the business line.
DIMONT Expands Collateral Loss Mitigation Department
DIMONT, a provider of specialty insurance and loan administration services, recently expanded its collateral loss mitigation department.
Encompassing all of DIMONT’s services, including hazard claims adjustment, investor claims management, flood insurance valuation and loss draft management, the collateral loss mitigation department allows the company to function as a disaggregated service provider, meaning that clients are free to utilize its services on a stand-alone basis.
By incorporating all of its services under the umbrella of collateral loss mitigation, DIMONT is able to significantly reduce timelines, vendor management costs and risk exposure for its clients, the company claims in a release.
“The expansion of our collateral loss mitigation services department helps our clients reduce costs and better manage all of their various needs through one service provider with a single DIMONT point of contact,” says Collin Harbour, vice president of business development at DIMONT. “At the same time, organizations can pick and choose the appropriate services without being locked into using services they do not need.”
Accumatch Hires Lisa Barlag As Tax Examiner Manager
Lisa Barlag recently joined Accumatch, a provider of property tax tracking services for non-escrowed loans, tax reporting and payment services for escrowed loans, and redemption services for delinquent portfolios, as tax examiner manager.
Barlag has 25 years of relevant tax experience, having previously served as a supervisor overseeing a team of 11 professionals at CoreLogic and before that as senior project manager and international operations manager for the company.
Her experience with search operations led her to be the key player for CoreLogic’s offshoring processes and later become the international operations manager covering three cities in India.
Earlier in her career, she served in the roles of operations manager, international operations manager and trainer for First American Financial Corp.
