WEST PALM BEACH, Fla., April 26, 2017 (GLOBE NEWSWIRE) -- Ocwen Financial Corporation, (NYSE:OCN) (Ocwen or the Company), today announced the filing of two related motions that seek an early court ruling that the Consumer Financial Protection Bureau (CFPB) is unconstitutional, and so its enforcement action against Ocwen should be thrown out.
As discussed in yesterday's legal filings, Ocwen believes that the CFPB is unconstitutionally structured because it vests too much unfettered power in the hands of the CFPB's Director and the Bureau itself, without any meaningful oversight by the President or Congress. A panel of three judges on the D.C. Circuit Court of Appeals recently found that the CFPB is unconstitutionally structured—a decision which is now being reviewed by the entire D.C. Circuit Court of Appeals. In that case, the Department of Justice recently filed a brief that stated its agreement with the panel decision, that the CFPB is unconstitutional for this reason.
In yesterday's filings, Ocwen informed the Court and the DOJ that Ocwen intends to directly challenge the CFPB's constitutionality at the earliest possible opportunity and to seek dismissal of the case on this ground and others. 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 Department of Justice to participate in the case so the Court can consider fully the Attorney General's conclusion that the CFPB is unconstitutionally structured.
Ocwen seeks to get this issue resolved early, because it should be relieved of having to defend this unfair action from an unconstitutional agency. The filings inform the Court how this lawsuit reflects what happens when there is an unaccountable agency like the CFPB. For example, the Complaint is riddled with allegations about conduct that Ocwen already addressed—sometimes years ago—with refunds, credits, or other consumer remedies. Moreover, the CFPB contends that on "numerous" occasions or "at least one thousand" times Ocwen has wrongfully started or completed foreclosures on consumers who were in the midst of applying for or performing a loan modification. But so far as Ocwen is aware—and the Complaint does not identify the loans—the CFPB did not actually look at the individual servicing files for these consumers' loans before making this allegation.
Over the course of two years, Ocwen has been in regular communications with the CFPB. Despite Ocwen's cooperation and repeated offers to provide specific loan files for the CFPB's review, the CFPB has proceeded by filing a lawsuit without factual or legal merit, apparently in an effort to bolster its own political agenda. Although Ocwen believes the lawsuit should be dismissed on constitutional grounds, it also is prepared to vigorously contest the inaccurate CFPB allegations.
Finally, the CFPB's conclusory claims of borrower harm are incompatible with the well-documented positive results from Ocwen's borrower-assistance efforts. Ocwen's ability to help homeowners at risk of foreclosure remain in their homes through responsible loan modifications continues to positively impact communities across the country. Since January 1, 2008, Ocwen has granted over 735,000 loan modifications, including approximately 75,000 in 2016, and Ocwen is responsible for 20% of all modifications under the U.S. Department of the Treasury Home Affordable Modification Program, the federal government's leading modification program. Ocwen also has provided billions of dollars in principal forgiveness to homeowners at risk of foreclosure. In addition, Ocwen has worked closely with its Community Advisory Council, a diverse group of national, regional, and local non-profit housing counseling, community development, and civil rights organizations, to maximize Ocwen's positive impact in communities across the country.
About Ocwen Financial Corporation
Ocwen Financial Corporation is a financial services holding company which, through its subsidiaries, originates and services loans. We are headquartered in West Palm Beach, Florida, with offices throughout the United States and in the U.S. Virgin Islands and operations in India and the Philippines. We have been serving our customers since 1988. We may post information that is important to investors on our website (www.Ocwen.com).
Forward Looking Statements
This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements may be identified by a reference to a future period or by the use of forward-looking terminology.
Forward-looking statements by their nature address matters that are, to different degrees, uncertain. Our business has been undergoing substantial change which has magnified such uncertainties. Readers should bear these factors in mind when considering such statements and should not place undue reliance on such statements. Forward-looking statements involve a number of assumptions, risks and uncertainties that could cause actual results to differ materially. In the past, actual results have differed from those suggested by forward-looking statements and this may happen again.
Important factors that could cause actual results to differ materially from those suggested by the forward-looking statements include, but are not limited to, the following: our servicer and credit ratings as well as other actions from various rating agencies, including the impact of downgrades of our servicer and credit ratings; adverse effects on our business as a result of regulatory investigations or settlements; reactions to the announcement of such investigations or settlements by key counterparties; increased regulatory scrutiny and media attention; claims, litigation and investigations brought by government agencies and private parties regarding our servicing, foreclosure, modification and other practices, including uncertainty related to past, present or future investigations, litigation, and settlements with state regulators, the CFPB, State Attorneys General, the SEC, Department of Justice or HUD and actions brought under the False Claims Act by private parties on behalf of the United States of America regarding incentive and other payments made by government entities; any adverse developments in existing legal proceedings or the initiation of new legal proceedings; our ability to effectively manage our regulatory and contractual compliance obligations; our ability to contain and reduce our operating costs, including our ability to successfully execute on our cost improvement initiative; the adequacy of our financial resources, including our sources of liquidity and ability to sell, fund and recover advances, repay borrowings and comply with debt covenants, including the financial and other covenants contained in them; volatility in our stock price; the characteristics of our servicing portfolio, including prepayment speeds along with delinquency and advance rates; our ability to successfully modify delinquent loans, manage foreclosures and sell foreclosed properties; uncertainty related to legislation, regulations, regulatory agency actions, government programs and policies, industry initiatives and evolving best servicing practices; as well as other risks detailed in Ocwen's reports and filings with the Securities and Exchange Commission (SEC), including its annual report on Form 10-K for the year ended December 31, 2016 and any current and quarterly reports since such date. Anyone wishing to understand Ocwen's business should review its SEC filings. Ocwen's forward-looking statements speak only as of the date they are made and, we disclaim any obligation to update or revise forward-looking statements whether as a result of new information, future events or otherwise.
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