Regulator investigating Ocwen steps down

by Rachel.Norvell11 Nov 2014
The man behind the recent Ocwen Financial Corp. investigation is reported to be weeks away from leaving his post at the New York Department of Financial Services (NYDFS).

According to reportsBen Lawsky, who has served as superintendent of the NYDFS since 2011, will resign in early 2015. New York Daily News said his departure is all a part of a “mass exodus” of aides to New York governor Andrew Cuomo, who just won re-election in last week’s election.

Lawsky has been at the center of the recent Ocwen firestorm.  The nation’s largest servicer of subprime mortgages is accused of having denied struggling borrowers the chance to fix loan problems and avoid foreclosures, according to regulators.

An investigation by the NYDFS found that Atlanta-based Ocwen Financial inappropriately backdated thousands of time-sensitive letters to mortgage borrowers and did not take action to fix the issue despite repeated notices of concern.

In the majority of cases, borrowers received a letter in the mail that denied mortgage loan modifications—letters that were dated more than 30 days before it arrived, wrote Lawsky in a letter to Timothy Hayes, executive vice president & general counsel for Ocwen.

According to Ocwen's third quarter earnings announcement, the company recorded a $100 million charge for a potential settlement with New York regulators. The Atlanta-based servicer also reported a net loss of $75.3 million, or $0.58 per share, for the third quarter compared to a net income of $60.6 million, or $0.39 per share, for the year-earlier quarter. Ocwen generated revenue of $513.7 million, down 3% compared to the 2013 third quarter.


Should CFPB have more supervision over credit agencies?