The Consumer Financial Protection Bureau sued Ocwen Financial Corp., one of the nation's largest mortgage servicers, on Thursday, alleging the company engaged in "significant and systemic misconduct" that caused borrowers to lose their homes.
In addition to the lawsuit filed in U.S. District Court in Florida, more than 20 state regulators took action against the company, limiting its operations in their states.
The federal consumer agency alleged that Ocwen conducted an error-plagued operation that failed to credit borrower payments, sent inaccurate statements and didn't make insurance payments on time, leading to a lapse of coverage.
The West Palm Beach, Fla., company also was accused of illegally starting foreclosure on at least 1,000 consumers and relying on a system to service loans that even an Ocwen executive called "ridiculous" and a "train wreck," the bureau said in news release.
"Ocwen has repeatedly made mistakes and taken shortcuts at every stage of the mortgage servicing process, costing some consumers money and others their homes," bureau Director Richard Cordray said in a statement.
Ocwen, in a statement, called the consumer agency's allegations "inaccurate and unfounded" and promised to "vigorously defend" against the lawsuit.
Business on 04/21/2017