Ocwen Financial Corporation Case Study

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Chapter 1: Research Proposal and Introduction Section 1: Introduction to Ocwen Financial Corporation Ocwen Financial Corporation, is a financial servicer holding business which, through its affiliates, creates and facilitates loans. Its headquarters are in West Palm Beach, Florida, with offices in Washington, D.C., U.S. Virgin Islands, St. Croix, Iowa, Texas, Orlando, Pennsylvania, and has support operations in India and the Philippines. Ocwen Financial Corporation, was founded in 2008 by billionaire mortgage entrepreneur William Erbey. Ocwen Financial Corporation offers myriad services such as “servicing, sub-servicing, special servicing, and stand-by servicing solutions for both residential and commercial loans including Real Estate Owned”…show more content…
In 2013, the Consumer Financial Protection Bureau (CFPB) which “is a regulatory agency responsible for overseeing financial products and services that are offered to consumers” (Consumer Finance Protection Bureau, 2013) sued Ocwen Financial Corporation for $2 billion dollars in fees and to refund $124 million to nearly 185,000 customers who in the past suffered the foreclosure their homes. “The Dodd-Frank Wall Street Reform and Consumer Protection Act, which protects consumers from unfair, deceptive, or abusive acts or practices by mortgage servicers” (Consumer Finance Protection Bureau, 2013) claimed that Ocwen Financial Corporation, not only took advantage of the borrowers, but also failed to apply their monthly mortgage payments into their accounts. The lack of proper training, customer service, and leadership brought the company to misinform property holders and failed to communicate effectively. The key problem was that numerous customers claimed that Ocwen Financial Corporation denied loan modifications and due to the economic situation at that time, they were not able to protect their homes from…show more content…
Hypothesis It is a hypothesis the primary reasons of the organization’s failure include the following: lack of leadership, lack of qualified compliance and risk management programs, inadequate control of internal legal documents and insufficient training of personnel. Research Significance and Purpose Research Significance The research on Ocwen Financial Corporation, is extremely valuable due to the difficulties the company is facing now, consequently, its necessary to expose the issues to improve profitability and gain back customers and investors’ confidence. A clear understanding of how to reverse and stop the lack of qualified compliance and risk management guidelines would not only benefit Ocwen’s customers, but also stockholders.

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