Mortgage Servicing Fraud
occurs post loan origination when mortgage servicers use false statements and book-keeping entries, fabricated assignments, forged signatures and utter counterfeit intangible Notes to take a homeowner's property and equity.
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Monday, September 27, 2010

Ocwen Financial Corp. said it lost a $12.7 million jury verdict tied to its former bank subsidiary.

Cartel Asset Management brought the case against the West Palm Beach-based mortgage servicing company (NYSE: OCN) and Ocwen Loan Services, the successor to its former savings institution, Ocwen Federal Bank. The vendor accused them of misappropriation of trade secrets and violating its contract.

The trial started Sept. 13 in U.S. District Court in Denver. In a Securities and Exchange Commission filing on Monday, Ocwen said the jury returned a $12.7 million verdict against it for actual and punitive damages. Interest and plaintiff’s legal fees could be added on top of that.

“Ocwen is evaluating post-verdict legal remedies in connection with the verdict,” the company stated in a news release.

As of June 30, Ocwen Financial had $229.9 million of available cash, so paying the verdict wouldn’t be a significant blow to its balance sheet.

Ocwen shares were down 6 cents to $9.95 in morning trading. The 52-week high was $12.77 on May 28. The 52-week low was $8.61 on Aug. 25.

Read more: Ocwen Financial loses $13M verdict - South Florida Business Journal

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