The CFPB complaint makes it easy for lawyers to put together private actions for violations of federal law and with few revisions violations of state law. You have a template here that will go a long way toward establishing credibility to homeowners who are victims of intentional malfeasance by servicers, master servicers, trustees and others. At the very least this data in the lawsuit firmly establishes that there was reckless indifference to the consequences visited upon homeowners and the investors whose money was at risk.
Ocwen pursues the goal of foreclosure at the behest of banks that have no actual interest in the alleged loans. These lawsuits represents actual findings of misbehavior in the “servicing” of purported loans including wrongful foreclosures. It is a pandemic problem not limited to Ocwen. At some point, perhaps now, the question that needs an answer will be answered: Why pursue foreclosure at all costs to the detriment of both the the owner of the debt and the debtor?
The corollary question is why does Ocwen (and others) need to resort to illegal tactics if the loans are real and the paper is authentic?
The only logical answer is that Ocwen was not acting on behalf of “the investor” nor the “borrower” nor in compliance with basic tenets of law. This is a cancer growing on our legal system and our financial system wherein the financial markets have become addicted to a lie, to wit: that the MBS were really mortgage backed securities, that the common law sham REMIC trusts owned loans, and that the sales of nearly all “derivatives” were fraudulent at their base.
Get a consult! 202-838-6345
THIS ARTICLE IS NOT A LEGAL OPINION UPON WHICH YOU CAN RELY IN ANY INDIVIDUAL CASE. HIRE A LAWYER.
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see https://www.thenation.com/article/the-cfpb-just-sued-a-crooked-mortgage-servicer-but-indicted-itself/
Quotes from CFPB Lawsuit: (see
Ocwen)
H. Ocwen has engaged in unlawful foreclosure practices.
177. Ocwen has long touted its ability to service and modify distressed loans, claiming, “helping homeowners is what we do.” In fact, Ocwen has failed to accurately maintain foreclosure-related information necessary to ensure that it provides borrowers with required foreclosure protections. As a result of these and other failures, Ocwen has wrongfully initiated foreclosure proceedings and wrongfully conducted foreclosure sales.
183. In addition, a servicer is prohibited from engaging in unfair, deceptive, and abusive acts and practices, including in the context of foreclosure activity, under the CFPA.
2. Ocwen’s deficient foreclosure policies and procedures violate Regulation X.
200. …Ocwen has inappropriately conducted foreclosure sales on the homes of borrowers who were performing upon agreements for loss mitigation options, such as a loan modification. The borrowers accepted and were performing upon the terms of the options—for example, by making trial payments according to the terms of a loan modification. Even though the borrowers had been doing everything they were supposed to do, Ocwen unilaterally breached the terms of its loss mitigation agreements with borrowers and foreclosed on their loans.
4. Ocwen’s foreclosure failures have caused significant borrower harm.
201. Aside from the obvious harm to any borrower whose home is wrongfully foreclosed upon, Ocwen’s illegal foreclosure practices have also caused significant financial harm, emotional distress, negative credit reporting, and other harm to borrowers.
It committed numerous violations of Federal consumer financial laws that have harmed borrowers. Among other things, Ocwen has improperly calculated loan balances, misapplied borrower payments, failed to correctly process escrow and insurance payments, and failed to properly investigate and make corrections in response to consumer complaints. Ocwen has compounded these failures by illegally foreclosing upon borrowers’ loans and selling loan servicing rights to servicers without fully disclosing or correcting errors in borrowers’ loan files.
The Bureau brings this action against the Defendants under: (1) Sections 1031 and 1036 of the CFPA, 12 U.S.C. §§ 5531, 5536; (2) Sections 807(2)(a), 807(10), and 808 of the Fair Debt Collection Practices Act, 15 U.S.C. §§ 1692e(2)(a), 1692e(10), and 1692f (the “FDCPA”); (3) Sections 6 and 19 of the Real Estate Settlement Procedures Act (“RESPA”), 12 U.S.C. §§ 2605, 2617, and the regulations promulgated thereunder at Regulation X, 12 C.F.R. part 1024 (“Regulation X”); (4) Section 105(a) of the Truth in Lending Act (“TILA”), 15 U.S.C. § 1604(a), and the regulations promulgated thereunder at Regulation Z, 12 C.F.R. part 1026 (“Regulation Z”); and (5) Section 3(b) of the Homeowners Protection Act of 1998, 12 U.S.C. § 4902(b) (the “HPA”).
3. The Bureau brings this action to obtain permanent injunctive relief, restitution, refunds, disgorgement, damages, civil monetary penalties, and other relief for the Defendants’ violations of Federal consumer financial law.
In 2009, Ocwen spun off its internal technology department into a separate company, Altisource Portfolio Solutions (“Altisource”). As a result of this spin-off, Altisource owns and maintains the REALServicing platform. Ocwen has contracted with Altisource for technology services. In 2012 and 2013, while Erbey was the Chairman of the Boards of both Altisource and Ocwen, Ocwen extended this technology- services contract through 2025. {Editor’s note: This essentially contradicts the assertion by Ocwen Robo-witnesses that Ocwen maintains its own records and that the testimony of the robo-witness is sufficient foundation for the “records” to be introduced into evidence and that the “records” were “boarded” after “careful and through auditing.}
A. Ocwen loaded inaccurate and incomplete information into REALServicing and serviced loans using this information.
35. When Ocwen acquires servicing rights for loans, it moves, or “boards,” the records for those loans from the prior servicers’ systems of record onto REALServicing.
Ocwen boarded inaccurate and incomplete loan and payment data from prior servicers into REALServicing.
32. No other mortgage servicer uses REALServicing.
59. …REALServicing requires the use of more than 10,000 comment codes and flags. Yet, Ocwen lacks a complete data dictionary defining its comment codes, flags, and data fields. As a result, Ocwen personnel do not share a common understanding of what these comment codes or flags mean or how Ocwen personnel should use them.
61. …In 2015, an Ocwen consultant concluded that REALServicing had limited workflows and lacked automation. As detailed in the next subsection and Section III, in certain areas, such as payment processing and escrow, this lack of automation has resulted in significant and excessive manual workarounds that have created errors in borrowers’ accounts. {Editor’s Note: This was no accident. It allowed them to manually manipulate data for foreclosures under the cover of being required to do so. In fact neither RealServicing nor Ocwen were ever correcting errors. They were creating them. In other words, this was an intentional act of misrepresentation hiding under multiple layers of entities and practices}
- With respect to loan modification processes: “[u]pon review of a [loan modification] package, terms are found to be incorrect approximately 80% of the time (e.g., NPV miscalculation, final modification date incorrect)”;
Ocwen’s use of inaccurate and incomplete information to collect mortgage, tax, and insurance payments, communicate with borrowers about loss mitigation issues, proceed with foreclosures, and when selling the servicing rights of borrowers’ loans to new servicers has resulted in significant harm to borrowers.
Ocwen also delayed verifying the 1.7 million Residential Capital loans it previously acquired in 2013, and which it moved from Residential Capital’s servicing platform and boarded onto REALServicing on a rolling basis beginning in early 2014. Ocwen did not even begin the verification process for the Residential Capital loans until September 1, 2014; at that time, Ocwen was servicing more than 1.1 million unverified Residential Capital loans on REALServicing.
In November 2014, Ocwen determined that it was taking, on average, 261 days to complete its verification process for each loan it boarded. In some cases, the verification process has taken more than a year, far beyond Ocwen’s expected 60-day time period.
41. As of 2014, in addition to boarding loans with inaccurate loan information, Ocwen also boarded loans that contained payment history data that it had reason to believe was inaccurate or incomplete. Ocwen, for example, boarded incomplete or incorrect payment histories onto REALServicing, such as payment histories that include misapplied payments and transactions that occurred before the loan was even originated.
As of 2014, Ocwen had also failed to verify whether the prior servicers’ corporate advances or fees for servicing-related expenses—such as attorneys’ fees, property inspection fees, property preservation fees, force-placed insurance charges, and foreclosure-related expenses—were valid and actually owed by borrowers. In many instances, Ocwen has charged borrowers for these charges and fees, even though neither Ocwen nor the prior servicer had invoices or other documents to support these charges and fees, and even though Ocwen was receiving disputes from borrowers claiming that these charges or fees were not owed.
In June 2015, Ocwen also learned that it did not have documentation to support $58 million out of $85 million in corporate advances that it had charged to borrowers whose loans it transferred to new servicers.
47. Even when Ocwen completed its verification process and identified inaccuracies in loan data, in many instances, Ocwen has failed to accurately correct the errors in REALServicing. For example, in November 2014, Ocwen conducted an internal audit and found that its loan verification personnel were not properly correcting or updating the information in REALServicing in 63 percent of loans the audit team reviewed. The audit found that Ocwen personnel had failed to properly correct critical data fields such as loan maturity date, loan term, first payment date, balloon term, and first interest rate cap.
48. In 2015, Ocwen’s outside consultant identified additional deficiencies in Ocwen’s loan boarding process, such as:
- “High volume of loans error out of the automated process for unknown reasons requiring manual revision”; {Editor’s note: “manual revision is a euphemism in this context. It is actually fabrication of data to reflect what is necessary to foreclose}
- “Limited available data fields cause various groups to use and reuse same fields for different information”; and
- “Limited system functionality in place to accommodate SCRA [Servicemembers Civil Relief Act] requirements (e.g., unable to stop fees if fee was in place prior to customer becoming SCRA eligible).”
an internal communication in 2014 with Ocwen’s Chief Executive Officer, Ocwen’s Head of Servicing described Ocwen’s technology as:
An absolute train wreck. I know there’s no shot in hell, but if I could change systems tomorrow I would. I can’t tell you the number of hours I and others spend on basic servicing technology blocking and tackling. I’m not talking about differentiators here. I’m talking about getting system to stay online, escrow analysis to work, letters to print, etc. It’s ridiculous.
By treating the allegations of these agency lawsuits as evidence of administrative findings, it could be argued that there is presumption of wrongdoing. Even without the presumption, the evidence of Ocwen’s track record should be presented to courts to counter the presumptions that are applied in favor of the foreclosing party. Actual proof of actual monetary transactions should be required instead of presumptions attached to pleadings, testimony and documents.
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And fundamental to the analysis is that Ocwen is merely doing the bidding of banks that are “underwriters” of MBS and Master Servicers who are diverting money away from investors. In the final analysis, the inescapable conclusion is that the real party in interest is those banks. And when the analysis is complete there is only one logical conclusion: the banks are pursuing a strategy of making their claims for themselves under the guise of an encumbrance in favor of someone else.
Quotes from Ocwen Lawsuit; (see
Ocwen)
86. …in January of 2016, Ocwen found that “$8,420,208 in payments were received but not posted to customer’s accounts.” Ocwen concluded: “Management has identified that not applying received payments or loading payments multiple times has become a common occurrence.”
89. …Ocwen has misapplied borrowers’ payments and miscalculated borrowers’ loan balances and amounts due.
90. [Improper data in bankruptcy actions]
- “There is no connection between the proof of claim as determined in Equator/REALResolution [the system Ocwen uses to process bankruptcy] and the pre-petition arrearage balances in REALServicing.
97. …even though the borrower had sent Ocwen funds in advance to prepay her mortgage, the consumer reports that Ocwen changed her status to delinquent in May 2016, charged her late fees, and made disruptive and embarrassing collection calls to her at her home and work.
B. Ocwen has botched borrowers’ escrow accounts.
100. Ocwen has also failed to perform basic tasks associated with managing borrowers’ escrow accounts. Specifically, due to systems failures, control lapses, and excessive reliance on manual processes, Ocwen has failed to conduct escrow analyses or accurate escrow analyses; failed to timely send borrowers accurate escrow statements; and failed to properly account for and apply borrower escrow shortage payments.
134. Ocwen’s failures have resulted in the lapse of hazard insurance coverage for more than 10,000 borrowers. As of March 2015, more than:
- 1,500 of these borrowers were able to reinstate their insurance policy, but had to pay a higher premium;
- 3,000 of these borrowers received letters from Ocwen indicating that it was going to impose force-placed insurance on their loans because they lacked hazard insurance;
- 500 of these borrowers had force-placed insurance imposed on their loans by Ocwen; and
- 100 of these borrowers were foreclosed upon by Ocwen.
Ocwen failed to properly recognize individuals as successors, denied loss mitigation assistance to, and, in some instances, ultimately conducted foreclosure sales upon the loans of successors who may have been eligible for a loan modification or other loss mitigation options.
see http://therealfact24.com/ocwen-caught-difficult-situation-misconduct-foreclosure-misrepresentation/
see http://www.courthousenews.com/ocwen-financial-faces-boatloads-complaints/
Quotes from Articles:
Ocwen Financial Corporation is one of the major players in the mortgage world providing commercial and residential mortgage to the people of the US. It also provides Asset Management services to the clients. The U.S. Consumer Financial Protection Bureau had filed a lawsuit against Ocwen Financial Services for misconduct against the borrower’s loan amounts, providing false and inaccurate monthly statements and much more. Nearly 20 states have filed this lawsuit against Ocwen due to which their share prices fell drastically by 60 percent within an hour of this news. This is not the first time Ocwen has been caught in such situation. They have faced a similar lawsuit in 2013.
At that time Ocwen Mortgage services were fined for $2 billion in compensation to the affected borrowers. Ocwen didn’t pay any attention to the continuous orders from CFPB to rectify their errors and continues with their own practices. Ocwen is accused by all the 20 states including Florida and North Carolina of violating the state as well as federal laws related to the consumer’s protection against loan and mortgages. Ocwen has a different story to tell against the allegation laid by CFPB.
Ocwen … mentioned that the allegations imposed currently are completely different from the 2013 case which would make up to only 1.3 million customers. Ocwen’s … share price declined with a record-breaking downfall to 53.9 percent after the news spread.
CFPB claims that Ocwen is involved in many unethical activities of forcibly foreclosing the homeowners, overcharging the customer for the services not utilized by them, failing to provide payment to the credit borrowers to mention a few. An REALServicing platform system is provided by Altisource to Ocwen from the time when they had a share in it. But later in 2009, it parted their ways but still provide the REALServicing. There has been a case filed against miscalculation of the mortgage amount by the customer even after making payment against the mortgage using the REALServicing system by the company. Since then Altisource is under the supervision and can be held responsible by the CFPB.
Ocwen has been in controversy due to many reasons and the allegations mentioned above are just few of them. William Erbey, an Ocwen founder, who managed Ocwen and Altisource was forced to leave his positions due to fine imposed by the New York’s financial regulator for $150 million.
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