Justice Department fines Ocwen subsidiary for foreclosing on military members’ homes

PHH agreed to pay a $750K fine to settle the charges

National /
Feb.February 08, 2019 03:30 PM

Ocwen’s Glenn Messina (Credit: iStock)

UPDATED, Feb. 11, 10:54 a.m.: A subsidiary of Ocwen agreed to pay a $750,000 fine to the Justice Department in order to settle allegations that it illegally foreclosed on the homes of service members of the U.S. military.

The federal agency alleges PHH Mortgage Corporation, a mortgage servicer that was acquired by West Palm Beach-based Ocwen last year, violated the Servicemembers Civil Relief Act (SCRA) by foreclosing on the homes of six service members without obtaining the required court orders, according to a Justice Department release.

The Justice Department launched an investigation along with its Civil Rights Division and the U.S. Attorney’s Office for the District of New Jersey after it received a complaint in May 2016. The investigation revealed that PHH Mortgage foreclosed on six homes of service members between 2010 and 2012. It’s illegal to foreclose on active military members homes during their service and one year afterward without a court order.

In a statement, PHH Mortgage said it cooperated with the Justice Department’s investigation and “voluntarily agreed to compensate the service members without admitting any wrong doing. PHH decided to settle this matter because it was in the best interest of these service members, and allows the company to move forward and avoid protracted litigation.”

PHH Mortgage and Ocwen have faced other allegations of improper foreclosures or mishandling of mortgage payments.

Ocwen acquired PHH Mortgage in October for $360 million, after its third quarter ended on Sept. 30.

Ocwen once had a market capitalization of more than $6 billion and made a fortune servicing subprime mortgages from banks after the financial crisis. U.S. Commerce Secretary Wilbur Ross was a member of its board of directors, and its founder Bill Erbey’s net worth was valued at $2.8 billion in 2013, according to Forbes.

In the last few years, however, the company has faced numerous financial and legal challenges. Regulators alleged that Ocwen mishandled consumers’ mortgage payments and illegally foreclosed on homes. In 2013, Ocwen reached a $2.1 billion settlement with the federal government and 49 states to address allegations of mortgage servicing misconduct.


Related Articles

arrow_forward_ios
Mallory Kauderer and Churchill’s Pub
Churchill’s Pub operator evicted amid foreclosure lawsuits against landlord
Churchill’s Pub operator evicted amid foreclosure lawsuits against landlord
The partially collapsed 12-story Champlain Towers South condo building (Getty)
Inside the tug-of-war over the Surfside condo site’s future
Inside the tug-of-war over the Surfside condo site’s future
Rendering of the proposed Bulgari Hotel (Bulgari)
Setai Miami Beach owners and condo association sue city over Bulgari hotel height increase
Setai Miami Beach owners and condo association sue city over Bulgari hotel height increase
Miami’s Opera Tower with Jerome Hollo (Opera Tower Leasing)
Allegedly rampant illegal short-term rentals at Miami’s Opera Tower lead to lawsuit seeking class action
Allegedly rampant illegal short-term rentals at Miami’s Opera Tower lead to lawsuit seeking class action
David Hammond, CEO of Opulence and Tomi Rose
Judge rules Tomi Rose must pay back nearly $77K to her former brokerage Opulence
Judge rules Tomi Rose must pay back nearly $77K to her former brokerage Opulence
U.S. President Joe Biden and first lady Jill Biden in Surfside at a memorial for people lost since the partial collapse of the Champlain Towers South condo building (Getty)
Judge OKs insurance disbursements to victims of fatal Surfside condo collapse
Judge OKs insurance disbursements to victims of fatal Surfside condo collapse
Joseph Chetrit with the Tides Hotel (Getty, Tides via Facebook)
Chetrit’s lender alleges it stole $2M insurance payout for South Beach hotel damage
Chetrit’s lender alleges it stole $2M insurance payout for South Beach hotel damage
Champlain Towers South exposed and deteriorated rebar (Getty)
Surfside condo “a time bomb:” Survivor’s lawsuit cites falling concrete, cracks and standing seawater in garage
Surfside condo “a time bomb:” Survivor’s lawsuit cites falling concrete, cracks and standing seawater in garage
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...