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Ocwen Moves to Expedite CFPB Ruling

Ocwen Financial Corporation is hoping to expedite a court ruling on the constitutionality of Consumer Financial Protection Bureau with two motions, filed Wednesday morning. The organization also filed a third motion inviting the Department of Justice to participate in the case.

On April 20, the CFPB filed suit against Ocwen, alleging the lender “engaged in significant and systemic misconduct at nearly every stage of the mortgage servicing process.” The motions filed today are a direct response to the Bureau’s allegations.

“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 release from Ocwen stated.

A three-judge panel from the D.C. Circuit Court of Appeals deemed the CFPB’s structure unconstitutional back in October of 2016, in the case of PHH Corp. v CFPB, vacating a $100 million fine against PHH and ultimately giving the president power to fire the CFPB director at will.

Seventeen state attorneys, as well as several lawmakers, made a bid to defend the CFPB, though the court rejected those bids in March. The full D.C. Circuit Court of Appeals will rehear the case, affording the CFPB the chance to defend itself. In response, the U.S. Department of Justice filed a brief in March asserting its agreement with the Circuit Court, saying “a removal restriction for the Director of the CFPB is an unwarranted limitation on the President’s executive power.”

In response to the CFPB’s recent suit against the organization, Ocwen called the Bureau “an unaccountable agency” and cited a number of apparent errors in its filing.

“The Complaint is riddled with allegations about conduct that Ocwen already addressed—sometimes years ago—with refunds, credits, or other consumer remedies,” Ocwen responded. “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.”

About Author: Aly J. Yale

Aly J. Yale is a freelance writer and editor based in Fort Worth, Texas. She has worked for various newspapers, magazines, and publications across the nation, including The Dallas Morning News and Addison Magazine. She has also worked with both the Five Star Institute and REO Red Book, as well as various other mortgage industry clients on content strategy, blogging, marketing, and more.

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