For those folks familiar with the lending and servicing industries, Ocwen is likely a familiar name.  Metaphorically speaking, it has become a regulatory piñata, with many state and federal watchdogs taking swipes at the company whenever the mood strikes. However, this attention is not necessarily undeserved or unexpected. It goes with the territory. You see, Ocwen is a – pardon another metaphor – a carrion eater; its business model includes servicing distressed mortgages, i.e. those in default and possible heading to foreclosure. It is the collection agent of last resort, the company that pays lenders money for the privilege of foreclosing homeowners. Continue reading “Did Ocwen Just Get “Out-Ocwened”?”

handcuffsAccording to Housingwire (“Ocwen offering indemnification to company directors and executive officers”):

“By its own admission, Ocwen Financial (OCN) is facing 21 pending investigations in 15 different states, is currently facing delisting by New York Stock Exchange for delaying the release of its annual report, and has run afoul of investors and homeowners alike.”

Continue reading “Ocwen’s ‘Get Out Of Jail Free’ Cards for Directors and Officers”

Take the Bonus and RunOn December 22, 2014, distressed homeowners with loans serviced by Ocwen got a nice bit of Christmas news, while the servicer got a lump of coal.

HousingWire just broke the story (here) that the company’s Executive Chairman, William Erbey is resigning and Ocwen Finnaical (OCN) will, once again, pay a huge fine, this time to the New York Department of Financial Services amounting to $150 million to homeowners.  According to the HousingWire article: Continue reading “Q-Rant! Ocwen Just Got A Big Lump Of Coal For Christmas!”

Washington DC“The economic role of the state has managed to hold the attention of scholars for over two centuries without arousing their curiosity.” ~George Stigler, “The Theory of Economic Regulation,” 1971.

Now that the unpleasantness of the financial crisis and Great Recession are being slowly relegated to the pages of economics textbooks, let’s ask: What’s changed after the 2007/8 near-death experience? Are the Big Banks smaller and more nimble? Are the regulators older and wiser? Sadly, the answer to both questions is a resounding “No!”  Continue reading “The Case of Carmen Segarra and “Regulatory Capture””

banks being banksIn a recent November 25, 2014 Wall Street Journal online article by Katie Martin here, we learn, once again, that international banking behemoth HSBC has been caught with its hand in the cookie jar.  This time, the scandal relates to the leaking of confidential client information to a hedge fund.

Confirming that the bank’s top execs believe it is better to seek forgiveness than permission, as HSBC was being investigated as part of a DOJ criminal investigation, it “self-reported.”   Apparently, HSBC had been advising British insurer Prudential PLC, “…on a huge acquisition and was working on a related multibillion-dollar currency transaction.” Continue reading “Banks Being Banks: HSBC Slapdown”


“SunTrust had no effective document management system in place to process and retain the borrowers’ applications and supporting documentation. When the HAMP applications poured in, SunTrust put them in stacks on the floor without organization. At one point, the stacks of opened and unprocessed HAMP applications were so voluminous that their weight buckled the floor.”  [Page 12, Restitution and Remediation Agreement between Suntrust and the U.S. Department of Justice, July 3, 2104.] Continue reading “SunTrustMortgage – In Trouble With The Feds!”

Gavel“Trials are primarily about the truth.  Consent decrees are primarily about pragmatism.”  Appellate Panel  Opinion, Second Circuit Court of Appeals in United States Securities and Exchange Commission vs. Citigroup Global Markets, Inc.

As the Big Bank settlements and stipulated decrees have continued to fill the financial pages over the last few years, most Americans have grown ambivalent about their habit of leaving federal courthouses after paying huge fines, but declining to admit they had broken any laws. The rationale for permitting them to do so is a concession by prosecutors in deference to Wall Street’s fear that such admissions would open the floodgates to litigation from shareholder groups.  Apparently, it’s one thing to admit you were caught with your hand in the cookie jar, but quite another to admit that cookie theft is wrong.  Continue reading “The Rakoff Effect On Big Banks’ Refusal To ‘Neither Admit Nor Deny’”

BooksFor those folks who remember the implosion of Enron in October 2001, they may also remember the collapse of its international accounting firm Arthur Anderson. The short version of the story is that when Enron’s financial scandal broke, Arthur Anderson’s management sent a missive to staff gently reminding them of the company’s “document retention” policies. This was interpreted by most as a not-so-subtle instruction to start shredding Enron paperwork, which they dutifully did. Continue reading “Swiss Miss: How Credit Suisse’s Conviction Avoided Arthur Anderson’s Fate”

DecisionEver thought your lender had made an error, say failing to properly credit a payment, or levied an inappropriate charge? What can you do, and how long will it take to resolve?  For the last several years, I have seen clients seeking error resolution undergo a Kafkaesque experience where their questions were either ignored, or met with a circular response that resolved nothing. ~PCQ

Effective on January 10, 2014, the CFPB has established some new ground rules that might [we can only hope and pray] help borrowers caught up in the endless loop of questions and non-answers. Summarized below are the new rules.  Direct quotes are from the excellent summary provided by PolicyWorks. Continue reading “CFPB – Error Resolution Rules (2014)”

Crying BabyOn January 28, 2014, Sergio Ermotti, chief executive of UBS AG, was fed up.  While visiting swanky Davos Switzerland [referred to in a New York Magazine article as “…the annual self-congratulatory kaffeeklatsch known as the World Economic Forum”] he vented. Like Howard Bealle in Network, he was ‘mad as hell and not going to take this anymore!’

What was the object of his angst?  He felt that his company was being unfairly picked on.  According to the article: Continue reading “Big Bank Bashing – Waahhh!”