US Bank v Mattos: Ocwen’s Witness unable to collaborate U.S. Bank’s Records

Thanks to Investigator Bill Paatalo of BP Investigative Agency for the heads up on this case.  Furthermore if you are suing U.S. Bank please note that THERE ARE NO RECORDS KEPT BY US BANK OF ANY KIND other than receipt of a monthly fee.  Bill Paatalo will be dropping a bombshell on these findings in the next month.

Please see ruling:  US Bank v Mattos – No Standing 06-06-17

The Supreme Court of Hawaii on certiorari to the Hawaii Court of Appeals reversed a prior summary judgment when it was determined that Ocwen’s witness was unable to speak for the validity of U.S. Bank’s records.   Hawaiian attorney Gary Dubin did an exemplary job demonstrating why the fraudulent assigments were void, not just voidable and that US Bank could not prove standing to foreclose.

The Defendants complained that the circuit court improperly granted summary judgment when there were genuine issues of material fact including two mortgage assignments that were robosigned by persons with insufficient authority or personal knowledge as to what they swore to.  There were also two assignments to the securitized trust in the chain of US Bank’s alleged ownership that were only supported by hearsay declarations inadmissible pursuant to Hawaii’s Civil Procedure Rule 56 and Evidence Rules.  Therefore, the court ruled that the Defendant’s loan violated the requirements of the securitized trust’s Pooling and Servicing agreement.

U.S. Bank’s declarants also had no idea how earlier business records had been compiled in regards to the two invalid mortgage assignments allegedly assigned to the securitized trust.

It was ruled that the Intermediate Court of Appeals (ICA) incorrectly concluded that the declaration of Richard Work, the Contract Management Coordinator of Ocwen Loan Servicing, LLC (“Ocwen”), rendered him a “qualified witness” for U.S. Bank’s records under the Hawai‘i Rules of Evidence Rule 803(b)(6)- hearsay exception for records of regularly conducted activity.  In addition, U.S. Bank failed to establish that it was a holder entitled to enforce the note at the time the foreclosure complaint was filed(see Bank of America, N.A. v. Reyes-Toledo, 139 Hawaii(2017)).

 

Unfortunately in regards to the first issue on certiorari, the court was unfamiliar with the term “robosigning” and ruled that since the legal effect of “robo-signing” was not necessary to  the determination of the case, the court sidestepped the issue and set aside the ICA’s holding that, “conclusory assertions that fail to offer factual allegations or a legal theory indicating how alleged “robo-signing” caused harm to a mortgagee” are insufficient to establish a defense in a foreclosure action.

 

Addressing the factual allegations underlying the “robo-signing” claim, however, the court concluded that there was a genuine issue of material fact as to whether Ocwen had the authority to sign the second assignment of mortgage to U.S. Bank. With respect to the second issue on certiorari, the court affirmed the ICA in part and followed the majority rule in U.S. Bank Nat. Ass’n v. Salvacion (Hawaii App. 2014) and held that, “a third party unrelated to a mortgage securitization pooling and servicing agreement lacks standing to enforce an alleged violation of its terms unless the violation renders the mortgage assignment void, rather than voidable.”  However the court limited the holding to the judicial foreclosure context not impacting non-judicial foreclosures.

 

The court issued a reversal and vacated the prior March 9, 2016 Judgment on Appeal, as well as the circuit court’s August 26, 2014 Findings of Fact, Conclusions of Law and Order Granting Plaintiff’s Motion for Summary Judgment and Decree of Foreclosure against all defendants and remanded the case back to the circuit court.

It is unfortunate that the circuit court and Intermediate Court of Appeals were so obviously biased towards the homeowner that they refused to apply prior rulings of law that would have quickly resolved this case.  However, part of the MegaBank-Lower Court game is to exhaust the homeowner of financial resources, while abusing them with delay strategies, discovery deficits and the misapplication of established law.  When these unethical methods are employed and a homeowner is forced to return to the lower courts and start all over again, the banks and courts should immediately be held responsible for violations of due process and the deliberate use of legal abuse tactics. The homeowner should in time be compensated for the stress incurred, emotional trauma, any lost earnings, and any resulting physical and mental health degradation.  Only when there is a sufficient financial penalty will the banks and courts consider following the rule of law.

 

 

Bloomberg Law: Ocwen Loses Bid for Early Test of CFPB’s Constitutionality

Ocwen Loses Bid for Early Test of CFPB’s Constitutionality

https://www.bna.com/ocwen-loses-bid-n73014451876/

By Chris Bruce

A federal judge June 2 blocked Ocwen Financial Corp.’s bid to test the constitutionality of the Consumer Financial Protection Bureau in the early stage of a closely watched enforcement case ( Cons. Fin. Protection Bureau v. Ocwen Fin. Corp. , S.D. Fla., 17-cv-80495, 6/2/17 ).

The ruling by Judge Kenneth Marra of the U.S. District Court for the Southern District of Florida allows the CFPB to proceed unimpeded with its April lawsuit alleging that Ocwen violated consumer protection laws in servicing loans of distressed borrowers.

Ocwen sought an early case conference on the constitutional question, saying it should be settled before allowing the CFPB to go further. Marra disagreed, saying that would depart from settled procedural rules and might delay the case. He said Ocwen may still make its constitutional attack on a motion to dismiss.

Marra also declined Ocwen’s request to seek U.S. Attorney General Jeff Sessions’ views on the CFPB’s constitutionality. In a separate order June 2, Marra said it’s “premature” to invite the Attorney General’s views at this point.

Marra said he can weigh that request again in the context of an Ocwen motion to dismiss. “Until a motion is filed setting forth the exact basis for the challenge, the Attorney General will not have sufficient information to determine whether he should intervene,” Marra said.

Ocwen: Case Unjustified

“We have reviewed the order, which addresses how the Court would like to have the constitutional attack presented to it,” Ocwen spokesperson John Lovallo said in an email to Bloomberg BNA. “We look forward to including that argument with all of the other reasons CFPB’s suit is unjustified and should be dismissed.”

Marra’s June 2 orders, especially his decision not to fast-track the constitutional issue, could help the CFPB in other litigation. In April, when Ocwen sought the case conference shortly after the CFPB filed its lawsuit, attorneys said Ocwen’s effort, if successful, might encourage other defendants in CFPB cases to make similar requests. Marra’s rulings give the CFPB more ammunition to fight any copycat moves.

The CFPB’s constitutional status is now being actively weighed by two federal appeals courts. The U.S. Court of Appeals for the District of Columbia Circuit’s full bench May 24 heard argument in a case involving PHH Corp. of Mount Laurel, N.J. Several observers who attended the argument say they expect that court to rule for the CFPB, perhaps setting up the case for consideration by the U.S. Supreme Court.

Meanwhile, the Ninth Circuit May 17 gave Burbank, Calif.-based D&D Marketing the go-ahead to challenge the CFPB’s constitutional status in an appeal from an enforcement lawsuit by the agency.

Ocwen is fighting a separate but related lawsuit filed the same day as the CFPB’s action. The suit by Florida Attorney General Pam Bondi (R), which also is being heard by Marra, similarly faults Ocwen’s servicing practices.

Ocwen is represented by Thomas M. Hefferon and Sabrina M. Rose-Smith of Goodwin Procter in Washington, and Bridget Ann Berry of Greenberg Traurig in West Palm Beach, Fla.

The CFPB is represented by Jean Marie Healey, Atur Ravi Desai, and Jan Edwards Singelmann.

 

 


Ocwen accuses California settlement monitor of fraudulent strip club, casino expenses

Claims Fidelity Information Services engaged in ‘fraudulent, abusive billing scheme’

Gavel scales of justice

Fidelity Information Services perpetrated a “fraudulent and abusive billing scheme” and engaged in gross dereliction of duty in its role as the independent monitor of Ocwen Financial’s 2015 settlement with the state of California, Ocwen said in a bombshell lawsuit filed recently.

In the suit, filed in California state court, Ocwen states that FIS made “fraudulent or negligent misrepresentations” in the invoices it sent to Ocwen, claiming that money spent at strip clubs and casinos, among other things, were legitimate business expenses. In its defense, FIS tells HousingWire the lawsuit is baseless, more on that below.

Ocwen also claims that FIS significantly overcharged Ocwen for its monitoring services, including claims that FIS employees worked “implausible amounts of time” on given work days. Ocwen also claims that FIS billed it for “every minute its associates were onsite, regardless of whether they were actually working.”

According to Ocwen, FIS employees “took breaks as often as 14 times a day, or were observed watching videos instead of doing their jobs,” even though FIS billed Ocwen as if the associate spent the entire time working.

In its lawsuit, Ocwen claims that it repeatedly questioned FIS about the legitimacy of the charges it levied on the nonbank, but said that FIS claimed that all invoices were for appropriate charges.

“Whenever Ocwen questioned the legitimacy of FIS’s invoices, or confronted FIS about their increasing enormity, FIS reiterated its misrepresentations that the hours and expenses reflected on the invoices were legitimately worked and incurred,” Ocwen said in its lawsuit. “By continuing to represent to Ocwen that its invoices were legitimate, FIS induced Ocwen to continue to pay millions of dollars for work that was not performed.”

Ocwen goes on to claim that FIS believed it had “free reign” to lie about its actions without fear of any consequences.

Ocwen originally engaged FIS in 2015 to monitor its settlement with the California Department of Business Oversight, which stemmed from accusations that Ocwen failed to turn over documentation showing that it complies with California’s laws.

FIS served as the monitor of the settlement for two years, with its term as the California monitor ending when Ocwen reached a new settlement with California earlier this year.

That settlement involved Ocwen making a cash payment of $25 million and being required to provide an additional $198 million in debt forgiveness through loan modifications to existing California borrowers over a three-year period.

Over the two years that FIS served as the settlement’s monitor, Ocwen claimed that its mounting monitor costs, which totaled $147.5 million from Jan. 1, 2014 through June 30, 2016 from its various settlements with regulators, were a significant drag on its business.

Back in July 2016, Ocwen disclosed that the CDBO monitor believed that “certain onboarding activities” relating to new California originations in 2015 were prohibited by the terms of the consent order, and represented a material breach of the settlement.

That led to the February 2017 settlement, in which the CDBO claimed that Ocwen committed “hundreds” of violations of state and federal law over the last 18 months, including violations of the California Homeowner Bill of Rights.

And while all that was going on, Ocwen claims that FIS was abusing its business relationship with Ocwen and overcharging the company on many different fronts.

Per Ocwen’s lawsuit, its original agreement with FIS established a $44.8 million budget for a 24-month review, including a loan-by-loan review of 50,000 loan files for California loans serviced by Ocwen.

But Ocwen claims that FIS “ran through” the $44.8 million budget for the two-year review in 11 months, while “delivering less than half of the work it was hired to do.”

Ocwen claims that FIS was on pace to charge Ocwen $120 million for the project, which would have been almost triple the project’s original budget.

Ocwen then claims that FIS “had every incentive to inflate the invoices it submitted to Ocwen,” because the company reimbursed its employees for their expenses out of its own pocket before billing Ocwen for the expenses.

Therefore, Ocwen believes that FIS intentionally ignored the “inappropriate nature of associate expenses” so it could pass them off to Ocwen and avoid its own financial loss.

“On information and belief, FIS exploited its position to enrich itself at Ocwen’s expense,” Ocwen said in its lawsuit. “It viewed this engagement as a license to steal from Ocwen.”

Ocwen’s lawsuit goes on to lay out several specific examples of “FIS’s rampant fraud,” including:

  • Submitting expense reimbursements for charges from strip clubs and casinos
  • Billing Ocwen for artificially inflated hours during which no actual work was performed
  • Submitting improper expense reimbursements that FIS associates were using as a form of supplemental income

And here’s a sample of Ocwen’s claims:

In a brazen example of timesheet fraud, FIS associates at the Coppell, Texas facility were caught watching videos on company time and leaving the office up to 14 times a day without “clocking out.” Ocwen expressed its concern to FIS and asked to see “key-swipe” data for FIS associates, which would enable Ocwen to identify timekeepers who left worksites excessively during each work day and to determine how long they were gone. FIS refused to provide the data and continued to charge Ocwen for the improper hours.

Ocwen also claims that FIS employees expensed meals at strip clubs and casinos, including expenses incurred at establishments such as: The Lodge: America’s Best Gentlemen’s Club; WinStar World Casino; Spearmint Rhino Gentleman’s Club; Buck’s Cabaret; and Harrah’s Casino.

Ocwen claims that even though such expenses are prohibited by FIS policy, the company billed Ocwen for the expenses nonetheless.

Ocwen also states that FIS employees “abused their rights to expense meals” by treating their $65 daily meal allowance as a $65 per diem, using the money to “buy groceries, personal items, and even alcohol—trying to get as close as possible to the $65 allowance.”

Ocwen claims that it brought these concerns to FIS management on many occasions, but was repeatedly rebuffed or told that the expenses were indeed legitimate.

In a statement provided to HousingWire, FIS denies Ocwen’s claims, stating that Ocwen’s lawsuit is without merit.

“The complaint filed by Ocwen Loan Servicing against FIS is completely baseless and we plan to defend ourselves vigorously against these false allegations and to pursue collection of the invoices this litigation was filed to avoid,” FIS said in a statement.

An Ocwen spokesperson, on the other hand, said that company’s lawsuit “speaks for itself.”

In a statement to HousingWire, Ocwen spokesperson John Lovallo said: “Our complaint speaks for itself, and documents that Fidelity Information Services exploited its position by submitting fraudulent, false, and improper invoices to Ocwen relating to FIS’s services and expenses. Ocwen intends to vigorously pursue all remedies stemming from FIS’s fraudulent and abusive billing scheme.”

And if you’re interested in reading Ocwen’s full filing for more of the company’s bombshell accusations against FIS, click here.

https://www.housingwire.com/articles/40235-ocwen-accuses-california-settlement-monitor-of-fraudulent-strip-club-casino-expenses

Here’s a detailed breakdown of Ocwen’s new restrictions by state

A deeper dive reveals what Ocwen can and can’t do going forward

The servicing issues at Ocwen Financial are allegedly so widespread that some states are placing stricter restrictions on the nonbank, beyond freezing the company’s ability to acquire new mortgage servicing rights.

On Thursday, a group of state business regulators issued joint cease-and-desist orders to Ocwen. The main announcement from the states shows that an examination into Ocwen’s servicing shows “several violations of state and federal law, including, but not limited to, consumer escrow accounts that could not be reconciled and willful and ongoing unlicensed activity in certain states.”

The orders also showed that the regulators are concerned with Ocwen’s ability to continue operating due to financial constraints, an issue that Ocwen denies.

The orders prohibit the acquisition of new mortgage servicing rights and the origination of mortgage loans by Ocwen Loan Servicing, a subsidiary of Ocwen, until the company is “able to prove it can appropriately manage its consumer mortgage escrow accounts.”

However, HousingWire analysis of each state’s cease-and-desist order or accompanying press release, show that some states’ regulators are restricting Ocwen’s business much further than that.

In fact, in one state, Ocwen has basically been put of out business entirely.

All in all, Arkansas, Connecticut, District of Columbia, Florida, Hawaii, Idaho, Illinois, Maine, Massachusetts, Mississippi, Montana, Nebraska, Nevada, North Carolina, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, West Virginia, Wisconsin, and Wyoming each placed restrictions on Ocwen’s business, according to the Conference of State Bank Supervisors.

But several states’ restrictions were not equal to the others– namely Massachusetts and South Dakota.

According to the announcement from the Massachusetts Office of Consumer Affairs & Business Regulation’s Division of Banks, Ocwen is not only no longer allowed to acquire new mortgage servicing rights, the company is also no longer allowed to service mortgages in the state, at all.

Here’s how Massachusetts describes its reasoning for restricting Ocwen’s business:

Of paramount concern is the company’s deteriorating financial condition, in which the company has lost nearly $1 billion since 2014, and will not be profitable by its own estimations for at least two years. The company has not developed or implemented an effective plan to curb these losses.

The examinations and monitoring noted the company has shown ineffective management of consumer escrow accounts and their internal servicing systems.

Therefore, Massachusetts is requiring Ocwen to “develop and implement a plan to transfer its loan servicing activities for Massachusetts consumer mortgage loans to a Division-approved licensed loan servicer(s).”

That means Ocwen can no longer service any mortgages in the state and must work to transfer all current mortgages it services to other servicers.

According to the Massachusetts Division of Banks, Ocwen services approximately 34,472 loans in Massachusetts, representing 3.5% of Ocwen’s portfolio – all of which must be transferred away.

Massachusetts’ order also requires Ocwen to “either fund or place mortgage loan applications in process with other lenders at no loss to applicants, and to cease accepting new applications,” which means no new loans for Ocwen in Massachusetts either.

“The Division will be closely monitoring Ocwen’s compliance with the Order,” the Division of Banks’ order states. “During this time, consumers with mortgage loans serviced by Ocwen should continue to submit loan payments to Ocwen in normal course in accordance with their loan terms. Ocwen will continue to service these loans until an orderly transfer of the servicing is completed in accordance with the Order. Any current mortgage loan applications should continue to be processed.”

South Dakota also placed its own serious restrictions on Ocwen’s business in the state, in the form of halting all foreclosures in the state until the escrow issues are addressed.

Here’s how the South Dakota Department of Labor and Regulation’s Division of Banking described it:

Ocwen does not possess the competence, experience, character, or general fitness required to permit Ocwen to continue to acquire new business as a mortgage lender in South Dakota.

The public interest will be irreperably harmed if Ocwen’s mortgage lending liscense is not conditioned immediately.

Therefore, Ocwen is required to “immediately cease acquiring new mortgage servicing rights, and acquiring or originating new residential mortgages serviced by Ocwen, until Ocwen can show it is a going concern by providing a financial analysis that encompasses all of the liabilities Ocwen currently maintains, as well as liabilities it has knowledge it will incur in the course of its business.”

Ocwen is also required to “immediately cease from acquiring new mortgage servicing rights, and acquiring or originating new residential mortgages serviced by Ocwen, until Ocwen can provide a third-party audit of its South Dakota escrow accounts showing that borrower funds are appropriately collected, properly calculated, and disbursed accurately and timely, and make any corrections of whatever type necessary to remedy all mistake, errors, and improprieties occurring due to Ocwen’s actions.”

Ocwen is also required to “immediately cease any and all foreclosures in the state of South Dakota until all South Dakota escrow accounts have been correctly and properly balanced and all corrections due to mismanagement of the escrow accounts have been effected.”

Nearly all of the other states list the same restrictions: no new mortgage servicing rights and no new loans to be serviced by Ocwen Loan Servicing, except for Nebraska and Rhode Island, which each expect Ocwen to provide detailed reports on its servicing activity on a frequent basis going forward.

The Nebraska Department of Banking and Finance states that Ocwen is prohibited from “the acquisition of mortgage servicing rights and the origination of mortgage loans until they are able to prove they can appropriately manage their consumer mortgage escrow accounts.”

Beyond that, Nebraska’s order requires Ocwen to provide a list of all the residential mortgages it services in the state, including the name, address, telephone number, and state of residence of the borrower; as well as the loan number; the owner of the loan; the account balance; and the location of any escrow funds.

Ocwen is then required to provide a report on the status of every Nebraska loan it services to the Nebraska Department of Banking and Finance every 10 days.

Ocwen is also required to provide written notice of all servicing transfers within 72 hours of execution.

And in Rhode Island, Ocwen “shall immediately cease from acquiring new mortgage servicing rights and acquiring or originating new residential mortgages serviced by Ocwen, which mortgage loans are secured by Rhode Island property, until Ocwen can provide the Department of Business Regulation with a reconcilement of its escrow accounts showing that consumer funds are appropriately collected, properly calculated, and disbursed accurately and timely.”

Ocwen is also required to “immediately cease acquiring mortgage servicing rights and acquiring or originating new residential mortgages serviced by Ocwen, which mortgage loans are secured by Rhode Island property, until Ocwen can show it is a going concern by providing a financial analysis that encompasses all of the liabilities it currently maintains, as well as liabilities it has knowledge it will incur in the course of its business.”

Additionally, Ocwen is required to file written confirmation by 4 p.m. on May 22, 2017, stating that the company has stopped acquiring new mortgage servicing rights and acquiring or originating new residential mortgages serviced by Ocwen for properties in Rhode Island.

Ocwen is also required to provide the Rhode Island’s Department of Business Regulation with the following information: a list of all loans secured by Rhode Island property presently serviced by Ocwen, including the date such loans were originated; a list of all loans secured by Rhode Island property as to which Respondents are acting as a third party servicer, including the date such loans were originated; and a list of all pending acquisitions of servicing rights and applications for mortgage loans that would be secured by Rhode Island property that are in the pipeline.

Below is a list of the remaining states with relevant passages about each state’s restrictions on Ocwen:

ArkansasArkansas Securities Commissioner, B. Edmond Waters, issued a press release in connection with a cease and desist order issued against Ocwen Loan Servicing, LLC and Ocwen Mortgage Servicing, Inc. Ocwen Loan Servicing, LLC and Ocwen Mortgage Servicing, Inc. are ordered to cease and desist from acquiring new mortgage servicing rights and originating new mortgage loans. The order prohibits the acquisition of mortgage servicing rights and the origination of mortgage loans until the company is able to prove it can appropriately manage its borrower mortgage escrow accounts.

ConnecticutThe Commissioner finds that the public welfare requires immediate action in order to prevent irreparable and immediate harm to Connecticut borrowers and the necessity of a temporary order requiring Ocwen to cease and desist from violating the laws cited herein, pursuant to Section 36a-52(b) of the Connecticut General Statutes in that, since December 2013, State Mortgage Regulators, including this Department, have been concerned about Ocwen’s mortgage servicing practices including, but not limited to, the misapplication of borrower payments and inaccurate escrow accounting and statements, and that the recent Multi-State Examination and CT Examination indicate that these issues have not been resolved, but rather may be exacerbated.  In addition, Connecticut borrowers have no ability to select a different mortgage servicer to remedy such persistent and pervasive errors by Ocwen.  Considering the potential harm to Connecticut borrowers and Ocwen’s inability to provide sufficient information concerning its existing borrower escrow accounts, the Commissioner finds it imperative that Ocwen cease from acquiring new mortgage servicing rights in connection with Connecticut residential mortgage loans for which it would have to maintain escrow accounts, and acquiring or originating new Connecticut residential mortgage loans serviced by Ocwen for which it would have to maintain escrow accounts, until it can ensure that the escrow accounts of its existing residential mortgage loan servicing portfolio in Connecticut are properly reconciled and that all Connecticut borrowers’ monies are maintained in segregated deposit or trust accounts for the benefit of such Connecticut borrowers.

District of ColumbiaThe majority of the orders prohibit the acquisition of new mortgage servicing rights and the origination of new mortgage loans until the company is able to prove it can appropriately manage its existing mortgage escrow accounts and not further harm consumers. Some orders also require Ocwen to cease any ongoing unlicensed activity.

FloridaFiled a separate lawsuit over Ocwen’s servicing practices.

HawaiiThe Notice of Charges and Proposed Order prohibits the acquisition of mortgage servicing rights and the origination of mortgage loans until the company is able to prove it can appropriately manage its consumer mortgage escrow accounts. The Notice of Charges and Proposed Order also demands Ocwen to cease illegal unlicensed activity that is believed to be occurring in Hawaii.

IdahoThe department’s order prohibits Ocwen from violating Idaho law in the handling of consumer escrow accounts. Managing the money that borrowers remit as part of their monthly mortgage payments is critical to the business of a mortgage servicer, and the department’s order requires Ocwen to accurately and lawfully fulfill that function when dealing with Idaho borrowers’ mortgage payments.

IllinoisA search of the Illinois Department of Financial and Professional Regulation did not show record of Illinois’ actions against Ocwen.

MaineOcwen shall immediately cease acquiring new mortgage servicing rights, and acquiring or originating new residential mortgages serviced by Ocwen, until Ocwen can show it is a going concern by providing a financial analysis that encompasses all of the liabilities Ocwen currently maintains, as well as liabilities it has knowledge it will incur in the course of its business; Ocwen shall immediately cease from acquiring new mortgage servicing rights, and acquiring or originating new residential mortgages serviced by Ocwen, until Ocwen can provide the state regulators with a reconcilement of its escrow accounts showing that consumer funds are appropriately collected, properly calculated, and disbursed accurately and timely.

MississippiOLS shall immediately cease acquiring new mortgage servicing rights, and acquiring or originating new residential mortgages serviced by OLS, until Ocwen can show it is a going concern by providing a financial analysis that encompasses all of the liabilities Ocwen currently maintains, as well as liabilities it has knowledge it will incur in the course of its business; OLS shall immediately cease from acquiring new mortgage servicing rights, and acquiring or originating new Mississippi residential mortgages serviced by OLS, until OLS can provide the DBCF with a third party audit of its escrow accounts associated with any Mississippi residential mortgage loans demonstrating that consumer escrow funds are appropriately collected, properly calculated, and disbursed accurately and timely; and make any and all corrections of whatever type necessary to remedy all mistakes, errors, and improprieties occurring in the past due to OLS’s Actions.

MontanaThe order prohibits Ocwen from acquiring new mortgage servicing rights until the company is able to establish that it can appropriately manage its Montana escrow accounts. Over the past three years, the Montana Division of Banking and Financial Institutions has handled 16 complaints against Ocwen and required Ocwen to credit $51,368.56 to Montana borrowers. Division officials will now focus on assisting borrowers who currently make mortgage payments to Ocwen.

NevadaThe majority of orders, including the order issued by the Nevada Division of Mortgage Lending, prohibit the acquisition of mortgage servicing rights and the origination of mortgage loans until the company is able to prove it can appropriately manage its existing mortgage escrow accounts and prevent harm to consumers.

North Carolina Lead state in announcing restrictions.

South CarolinaA search of the South Carolina State Board of Financial Institutions – Consumer Finance Division did not show record of South Carolina’s actions against Ocwen.

TennesseeThe Tennessee Department of Financial Institutions (“Department”) issued today an enforcement action against Ocwen Loan Servicing to prohibit the company from acquiring new mortgage servicing rights or originating mortgage loans in Tennessee until it provides the Department with a plan to demonstrate an ability to operate in a sound manner.

TexasA search of the Texas Department of Savings and Mortgage Lending did not show record of Texas’ actions against Ocwen.

West VirginiaA search of the West Virginia Division of Finance did not show record of West Virginia’s actions against Ocwen.

WisconsinThe majority of orders prohibit the acquisition of new mortgage servicing rights and the origination of mortgage loans until the company is able to prove it can appropriately manage its existing mortgage escrow accounts and not further harm consumers. Ocwen conducts mortgage loan servicing for approximately 1.5 million consumers nationwide, including about 13,500 in Wisconsin.

WyomingA search of the Wyoming Division of Banking did not show record of Wyoming’s actions against Ocwen.

[Editor’s note: If any of HousingWire’s readers can assist in locating the missing states’ orders against Ocwen, please contact Ben Lane at blane@housingwire.com. This article will be updated as appropriate.]

Sub-Prime Mortgage Servicer Ocwen fabricates Mortgage Documents

Ocwen is the bottom-feeder of mortgage servicing companies.  Most survey’s rank Ocwen as the absolute worst in customer service and accountability including consumer research by J.D. Powers.  Ocwen acts as a debt-collector and our experience at LendingLies is that Ocwen often cannot identify the true creditor or provide any documentation demonstrating who owns the loan.  Ocwen then resorts to fabricating documents and obfuscation to keep the borrower in the dark until they can successfully foreclose.  Why is the CFPB and Multi-State Mortgage Committee not investigating Ocwen’s fabrication of loan instruments?

Last year we had a client from Texas contact us who was dealing with Ocwen.  He had pulled his paperwork and discovered that his loan was one of the Taylor, Bean & Whitaker (TBW) fraudulent transactions, there was no evidence that the note had ever been endorsed, and there were no assignments from TBW to Ocwen.   To overcome these issues Ocwen either photoshopped endorsements or assignments in-house, or went to a third party who creates fraudulent loan instruments and filed to foreclose.

The Lendinglies staff sent a copy of the note and assignment to a forensic document fraud examiner and he discovered that the “original” copies submitted by Ocwen were nothing more than computer-generated forgeries.  We did a little more investigating and discovered that  the “corrective” assignment of the Deed of Trust was signed by Ocwen employee Amber K. Wilson.

Amber K. Wilson was employed as a Servicing Operations Specialist at Ocwen since May 2015.   Located in Iowa, Amber’s Linked-In profile stated that her current duties included, “Researching Mortgage Documents to verify a full Chain of Title is present. If it is not create the needed Documents (sic). Work from Excel Spread Sheet daily as well as several internal data programs.”  Amber K. Wilson admitted on a public website that Ocwen Loan Servicing creates documents to create a “proper Chain of Title” if there are errors.

This is an admission that Ocwen employees are engaging in fraudulent activity by fabricating notes and assignments (the derogatory information has since been removed from her Linked-In profile but a screenshot of last year’s Linked-In profile is included below). Hopefully the CFPB and Multi-State Mortgage Committee who have filed lawsuits will investigate this type of criminal activity.

It is fraudulent to recreate a chain of assignment with fabricated documents to create the appearance the current servicer has standing. As Neil Garfield has repeatedly pointed out- copies of the note and assignment don’t document an actual transaction (sale, transfer)- they are nothing but window dressing to create the illusion an event occurred.

Our client was a victim of these sham documents Ocwen filed in the Tarrant county records. He has been fortunate enough to find an attorney who has successfully kept Ocwen at bay.  Texas is involved in the multi-state effort to regulate large servicers across the country while ensuring compliance with applicable state and federal law, while protecting consumers.

Amber Wilson’s Linked-In profile where she admits fabricating loan instruments:

David Dayen: The CFPB Just Sued a Crooked Mortgage Servicer, but Indicted Itself

The lawsuit against Ocwen is welcome, but should have happened four years ago.

Injured by Ocwen? Take Action Now!

By K.K. MacKinstry

Ocwen has admitted that its mortgage servicing policies and loan processing systems are a “trainwreck”.  As regulators and the Consumer Fraud Protection Bureau (CFPB) tighten the noose on Ocwen, we recommend that Livinglies readers who have experienced issues with Ocwen contact their state Attorney General offices, the CFPB, state banking regulators and government representatives to express your outrage and share your experience NOW.

Although Ocwen is being investigated for predatory servicing practices, please make regulators aware of the deeper level of fraud that is occurring and consists of fabricating and forging loan instruments including notes and assignments.  If you have been subjected to any of Ocwen’s tactics that push homeowners into default please provide this information to the aforementioned agencies.

The regulators found that Ocwen manipulates escrow accounts to create defaults and problems with taxes and insurance, does not respond accurately to submitted Qualified Written Requests, fails to properly post payments, revokes loan modifications without reason, and engages in other tactics designed to create loan defaults.  Now is the time to speak up about your experiences.  If homeowners damaged by Ocwen inundate the CFPB with complaints, perhaps this predatory servicing operation will be shut-down for good.

It appears that Ocwen’s business model and policies were designed to maximize the chances that a homeowner will default through processes that create confusion, disinformation and a deliberate lack of accountability by Ocwen.   Ocwen is not the only loan-servicing entity that engages in these practices, but it is the one currently in the regulatory crosshairs.  If these issues are brought to light, other loan servicers may be forced to change their business practices or suffer the same fate.

To file a complaint with the CFPB do so here.

To file a complaint with a state member, please do so here or find your state contact below:

AK – Alaska
Ms. Patrice Walsh
State of Alaska Department Commerce, Community & Economic Development
Chief Examiner

Phone Number:

907-269-5496

Fax:

907-269-8146
AL – Alabama
Mr. Scott Corscadden
Alabama State Banking Department
Supervisor, Bureau of Loans

Phone Number:

334-242-3452

Fax:

334-353-5961
AR – Arkansas
Ryan Drake
Arkansas Securities Department
Examiner Supervisor

Phone Number:

501-324-8688

Fax:

501-683-5894
AZ – Arizona
Mr. Robert D. Charlton
Arizona Department of Financial Institutions
Superintendent

Phone Number:

602-771-2772

Fax:

CA – BRE
Mr. Jeffrey Mason
State of California Bureau of Real Estate
Chief Deputy Commissioner

Phone Number:

916-263-8728

Fax:

916-263-8943
CA – DBO
Mr. Victor Wells
California Department of Business Oversight
Deputy Commissioner

Phone Number:

213-576-7609

Fax:

213-576-7178
CO – DORA
Ms. Marcia Waters
Department of Regulatory Agencies – Division of Real Estate
Department of Regulatory Agencies – Division of Real Estate

Phone Number:

303-894-2422

Fax:

CT – Connecticut
Mr. Carmine Costa
Connecticut Department of Banking
Director, Consumer Credit Division

Phone Number:

860-240-8207

Fax:

860-240-8159
DC – District of Columbia
Mr. Christopher Weaver, Esq
Department of Insurance, Securities and Banking
Associate Commissioner of Banking

Phone Number:

202-442-7774

Fax:

202-535-1196
DE – Delaware
E. Quinn Miller
Office of the State Bank Commissioner
Investigative Supervisor

Phone Number:

302-744-2116

Fax:

302-739-2356
FL – Florida
Mr. Andy Grosmaire
Florida Office of Financial Regulation
Bureau Chief

Phone Number:

850-410-9848

Fax:

850-410-9914
GA – Georgia
Mr. Rod Carnes
Georgia Department of Banking and Finance
Deputy Commissioner, Non-Depository Financial Institutions Div.

Phone Number:

770-986-1371

Fax:

770-986-1029
HI – Hawaii
Ms. Iris Ikeda
Division of Financial Institutions
Commissioner of Financial Institutions

Phone Number:

808-586-2820

Fax:

808-586-2818
IA – Iowa
Mr. Rodney E. Reed
Iowa Division of Banking
Finance Bureau Chief

Phone Number:

515-281-4014

Fax:

515-281-4862
ID – Idaho
Mr. Mike Larsen
Idaho Department of Finance
Consumer Finance Bureau Chief

Phone Number:

208-332-8060

Fax:

208-332-8096
IL – Illinois
Mr. Alan Anderson
Illinois Dept. of Financial & Professional Regulation, Div of Banking
Senior Counsel of Mortgage Banking Regulation

Phone Number:

312-793-1419

Fax:

312-814-2238
IN – DFI
Ryan Black
Department of Financial Institutions
Deputy Director

Phone Number:

317-232-5850

Fax:

317-232-7655
IN – Sec. of State, Securities Div.
Mr. Alex Glass
Secretary of State, Securities Division
Securities Commissioner

Phone Number:

317-232-6681

Fax:

317-232-3675
KS – Kansas
Ms. Jennifer Cook
Kansas Office of State Bank Commissioner
Deputy Commissioner – Consumer and Mortgage Lending

Phone Number:

785-296-2266 x209

Fax:

785-296-0168
KY – Kentucky
Ms. Tammy Scruggs
Kentucky Department of Financial Institutions
Division Director, Non-Depository Institutions

Phone Number:

502-782-9086

Fax:

502-573-0184
LA – Louisiana
Mr. Darin Domingue
Louisiana Office of Financial Institutions
Chief Examiner

Phone Number:

225-922-2596

Fax:

225-925-4524
MA – Massachusetts
Ms. Cindy Begin
Massachusetts Division of Banks
Chief Risk Officer

Phone Number:

617-956-1523

Fax:

MD – Maryland
Mr. Clifford Charland
Maryland Commissioner of Financial Regulation
Director of Mortgage Examination Process

Phone Number:

410-230-6167

Fax:

ME – Maine
Mr. Terry Fancy
Maine Bureau of Consumer Credit Protection
Principal Consumer Credit Examiner

Phone Number:

207-624-8685

Fax:

207-582-7699
MI – Michigan
Mr. Kirt L. Gundry
Michigan Department of Insurance and Financial Services
Director, Mortgage Examination & Investigation Section

Phone Number:

517-284-8602

Fax:

517-284-8850
MN – Minnesota
Sarah Butler
Minnesota Department of Commerce
Supervisor, Non-depository Institutions

Phone Number:

651-539-1720

Fax:

651-368-0449
MO – Missouri
Mr. Mick Campbell
Missouri Division of Finance
Supervisor of Mortgage Licensing

Phone Number:

573-751-4243

Fax:

573-751-9192
MS – Mississippi
Ms. Traci McCain
Mississippi Department of Banking and Consumer Finance
Director, Mortgage Division

Phone Number:

601-321-6901

Fax:

601-321-6933
MT – Montana
Chris Romano
Montana Division of Banking and Financial Institutions
Non-Depository Bureau Chief

Phone Number:

(406) 841-2928

Fax:

(406)841-2930
NC – North Carolina
Ms. Molly Sheehan
North Carolina Office of the Commissioner of Banks
Deputy Commissioner of Banks/Non-Depository Entities

Phone Number:

919-715-6938

Fax:

919-733-2978
ND – North Dakota
Mr. Bob Entringer
North Dakota Department of Financial Institutions
Commissioner

Phone Number:

701-328-9933

Fax:

701-328-0290
NE – Nebraska
Ms. Jean Angell
Nebraska Department of Banking and Finance
Review Examiner

Phone Number:

402-471-2171

Fax:

402-471-3062
NH – New Hampshire
Ms. Raeleen Schutte
New Hampshire Banking Department
Director of Consumer Credit

Phone Number:

603-271-3561

Fax:

603-271-0750
NJ – New Jersey
Mr. Thomas M. Hunt
New Jersey Department of Banking and Insurance
Assistant Division Director

Phone Number:

609-292-7659 x50223

Fax:

609-292-3144
NM – New Mexico
Mr. Joe Cruz
New Mexico Financial Institutions Division
Industry Manager

Phone Number:

505-476-4519

Fax:

505-476-4670
NV – Nevada
Mr. James Westrin
Nevada Division of Mortgage Lending
Commissioner

Phone Number:

702-486-0789

Fax:

702-486-0785
NY – New York
Ms. Rholda Ricketts
New York Department of Financial Services
Deputy Superintendent

Phone Number:

212-709-5540

Fax:

212-709-5555
OH – Ohio
Zachary Luck
Ohio Division of Financial Institutions
Deputy Superintendent for Consumer Finance

Phone Number:

614-644-7517

Fax:

614-222-3554
OK – Oklahoma
Mr. Scott Lesher
Department of Consumer Credit
Administrator

Phone Number:

405-521-3653

Fax:

405-521-6740
OR – Oregon
Kirsten Anderson
Oregon Department of Consumer and Business Services
Administrator

Phone Number:

503-947-7478

Fax:

503-947-7862
PA – Pennsylvania
Mr. Robert Knaub
PA Department of Banking and Securities
Director for Non-Depository Licensing

Phone Number:

717-787-3717

Fax:

SC – Board of Fin Inst.
Mr. Jim Copeland
SC Board of Financial Institutions – Consumer Fin. Div.
Assistant Commissioner

Phone Number:

803-734-2020

Fax:

803-734-2025
SC – Dept. of Cons Affairs
Ms. Carri Grube Lybarker
South Carolina Department of Consumer Affairs
Administrator

Phone Number:

803-734-4233

Fax:

803-734-4060
SD – South Dakota
Ms. Jean Blow
South Dakota Division of Banking
Policy Analyst

Phone Number:

605-773-3422

Fax:

866-326-7504
TN – Tennessee
Mr. Mike Igney
Tennessee Department of Financial Institutions
Assistant Commissioner / Compliance Division

Phone Number:

615-253-7794

Fax:

615-741-2883
TX – OCCC
Ms. Leslie L. Pettijohn
Texas Office of Consumer Credit Commissioner
Consumer Credit Commissioner

Phone Number:

512-936-7640

Fax:

512-936-7610
TX – SML
Ms. Caroline C. Jones
Texas Department of Savings and Mortgage Lending
Commissioner

Phone Number:

512-475-1038

Fax:

512-475-1505
UT – Utah
Mr. Jonathan C. Stewart
Utah Division of Real Estate
Director

Phone Number:

801-530-6744

Fax:

801-526-4387
UT – Utah
Ms. Eva Rees
Utah Department of Financial Institutions
Supervisor

Phone Number:

801-538-8834

Fax:

801-538-8894
VA – Virginia
Ms. Susan E. Hancock
Virginia State Corporation Commission
Deputy Commissioner

Phone Number:

804-371-9701

Fax:

804-371-9416
VT – Vermont
Ms. Sue Clark
Vermont Department of Financial Regulation
Regulatory and Consumer Affairs Director

Phone Number:

802-828-4878

Fax:

802-828-1477
WA – Washington
Mr. Charles Clark
Washington Department of Financial Institutions
Acting Deputy Director and Director of Consumer Services

Phone Number:

360-902-0511

Fax:

360-596-3866
WI – Wisconsin
Cheryll Olson-Collins
Wisconsin Department of Financial Institutions
Administrator, Banking Division

Phone Number:

608-267-1707

Fax:

608-267-6889
WV – West Virginia
Ms. Tracy Hudson
West Virginia Division of Financial Institutions
Director of Nondepository Institutions

Phone Number:

304-558-2294

Fax:

304-558-0442
WY – Wyoming
Mr. Joe Mulberry
Wyoming Division of Banking
Deputy Commissioner

Phone Number:

307-777-7797

Fax:

307-777-3555
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