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Ocwen May Pay $40 Million To Resolve Backdating Issue

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The New York Department of Financial Services disclosed on October 21 that it found "uncovered serious issues including Ocwen's backdating of potentially hundreds of thousands of letters to borrowers, likely causing them significant harm."

Ocwen Financial Corp. (NYSE: OCN) almost immediately responded and said that the errors were inadvertent and were caused by software errors. The company said that it had taken the necessary steps to correct the issue which the company claimed has been fixed.

On Wednesday, Bloomberg reported that the number of affected borrowers varies between 4,200 to 73,200. If a settlement is required, Ocwen will likely be forced to pay a civil fine of $4 million to $84 million. Height Analytics analyst Edwin Groshans was quoted by Bloomberg stating that $40 million is a "reasonable expectation to start with."

Ocwen is scheduled to report its third quarter conference call on Thursday before market open with a follow-up conference call scheduled for 11 a.m. EST.

Shares were up 1.8 percent at $19.99.

Posted-In: Department of Financial Services Ocwen FinancialNews Legal

 

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