(Bloomberg) — New York's banking regulator asked Ocwen FinancialCorp. for information about an insurance agreement that it says maybe designed to funnel fees to an Ocwen affiliate for minimalwork.
|Benjamin Lawsky, the superintendent of the Department ofFinancial Services, is reviewing Ocwen's force-placed insurancearrangement with Altisource Portfolio Solutions, which he describedas “troubling,” according to a letter dated today obtained byBloomberg News.
|“Altisource will generate significant revenue from Ocwen's newforce-placed arrangement while apparently doing very little work,”Lawsky said in the letter. Documents suggest “Ocwen hiredAltisource to design Ocwen's new force-placed program with theexpectation and intent that Altisource would use this opportunityto steer profits to itself.”
|Lawsky is probing possible conflicts of interest at Ocwen, whichhas grown in recent years by acquiring the mortgage- servicingrights to distressed loans from large banks.
|In February, he requested information about Ocwen'srelationships with vendors, saying that William Erbey, the firm'schairman, was the largest shareholder in several affiliates thatprovide services to the company.
|A phone call to an Ocwen spokesperson wasn't immediatelyreturned.
|Copyright 2018 Bloomberg. All rightsreserved. This material may not be published, broadcast, rewritten,or redistributed.
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