Lawsky, Warren closing in on the scavengers of Wall Street

Make no mistakes about this, in Ocwen, the regulators are taking on the ringleaders of the 1% and for once it looks like Wall Street are running for cover.

Benjamin Lawsky and his outstanding team at the DFS, NY have Ocwen in a bind. After careful research, DFS have highlighted various problems with Ocwen's processes that pushed borrowers into foreclosure. The DFS have also highlighted conflict of interest in Ocwen's relationship with Altisource.

To understand what the borrowers have been up against in Ocwen, I am quoting a case from the New York Post:
"Eartha Smith, 75, a former fire department nurse who retired on disability, tried to get a modification on her $131,000 home loan in 2009, according to her lawyer, Peter Gleason.
Gleason received a letter from Ocwen on either Jan. 18 or 19, 2010, demanding financial information, pay stubs, bank statements and tax forms in order to modify the terms of Smith’s mortgage, he told The Post.
But the letter — which Ocwen said should be returned “as quickly as possible”— was dated Aug. 29, 2009, according to a copy of the letter provided to The Post. That’s about five months before he received it, according to Gleason.
“They put us through hell,” Eartha’s daughter, Evette, told The Post. “She’s a senior — she can’t get a modification to own her own home.”
Evette, who has power of attorney for her mother, took a leave of absence from school to help her mother fight Ocwen.
Ocwen sent thousands of letters to clients denying them a loan modification and giving them 30 days to appeal, Lawsky’s office said. Those letters were backdated more than 30 days, making it impossible for homeowners to modify their mortgages and increasing the likelihood of default.
“Ocwen’s indifference to such a serious matter demonstrates a troubling corporate culture that disregards the needs of struggling borrowers,” Lawsky said.
The Smiths have made 16 appearances at Brooklyn Supreme Court since 2009, and are still fighting the company to get the interest rate on their home loan lowered to 4 percent from 6.75 percent.
“They’re playing games,” Gleason said. “If you miss a deadline in this madness, they turn around and say that defendant failed to respond, move toward a summary judgment, and move toward eviction.”"

The Scavengers Of Wall Street
--------------------------------

One day I received a call from a woman. She was trying to reach someone from my team at Altisource to check the progress of her "deed-in-lieu of foreclosure" request. When a borrower for some reason cannot be offered a loan modification and no short sale offer has been approved by the loan servicer, the homeowner can sign a deed transferring the ownership to the lender/investor and walk away hoping the lender does not pursue a deficiency judgment. However, there is one catch - a deed-in-lieu does not wipe out encumbrances like junior liens unlike a foreclosure so lenders prefer to foreclose on the loan unless the title to the property is clear.

I looked up the title report and found an HOA lien. I asked her if she would pay if I could negotiate a reduced settlement amount with the HOA. Her answer made me wish I hadn't asked. She said she was pregnant and left alone to deal with her fate. The HOA had, in the past, garnished her wages and she had no savings left to settle the HOA dues. She was poor but she was brave. You have to be brave to deal with a situation where you are about to lose your home. You don't know where you'll be living next. Perhaps under a bridge. Even if you somehow try to get back on your feet, you'll have judgments to deal with. There she was, this brave woman, not only about to face this ordeal all by herself but also about to bring a baby into a world where almost everything is linked to money and that was the one thing she lacked.

We were able to get the HOA to waive off 85% of the dues and Altisource to pay the remaining 15%. Altisource agreed to pay because it was less than what they would have had to pay to the HOA post foreclosure. She thanked us and walked away into an uncertain future, handing her home on a plate to Altisource Residential, L. P. (ARLP Trust).

You may think that deeds-in-lieu and foreclosures are means through which a lender recovers part of the money it has advanced. However, I knew something that many people didn't. Altisource had just managed to acquire her home for a lot less than what it was worth. It was not loss mitigation. It was a very profitable deal. Welcome to the worst side of the financial world. Allow me to introduce the scavengers of Wall Street.

The Men Behind Ocwen and Altisource
-----------------------------------------

William Erbey identified in the 80's that there was a segment of borrowers who were more likely to default than others. They were low income homeowners who were barely able to make their monthly repayments. William Erbey created ways, utilizing deliberately-flawed technology and other means, to push these borrowers into foreclosure and sell the foreclosed homes. When questions were raised about the software Ocwen used and how Ocwen were offering employees incentives to push borrowers into foreclosure (ex. Ron Davis' testimony in Sealy Davis vs Ocwen), he spun off the technology and real estate businesses into a new company, Altisource, and located it in Luxembourg.

Wilbur Ross is a member of and has served as the 'Grand Swipe' (ringleader) of the notorious Wall Street secret society 'Kappa Beta Phi'. Erbey purchased Homeward from Ross and immediately inducted him into Ocwen's board. They got along like a house on fire. Ross was a 'scavenger among scavengers' and had many political connections. It is quite likely that Ross's connection with Blackrock's CEO Larry Fink came in handy when Blackrock threatened to sue Ocwen along with PIMCO. Wilbur Ross was rewarded for publicly backing Erbey. In July, Ocwen repurchased shares worth $72.3 million at a price significantly higher than the present market price from Wilbur Ross. No doubt Ocwen management was well aware of the investigations against them and the impact it would have on the stock's market price. Despite that, company funds were used to reward Wilbur Ross.

Leon Cooperman has been termed as the 'Pope of the 1%' and holds no less than 2,584,007 shares of Ocwen Financial Corporation as per the 13F filed on 08/14/2014. “Lawsky should be ashamed of himself,” Leon Cooperman, founder of the investment firm Omega Advisors, has said in the past on the Ocwen issue. “He’s acting as a politician to advance his personal interest, not doing his job as a regulator.”

Another key man in all this is Orin Kramer, a major fundraiser for the Obama 2012 campaign in New York. Kramer introduced Erbey to various influential Democrats like Austan Goolsbee.

The New Yorker reported in its October 2012 edition about a dinner which included Al Gore, Leon Cooperman, Orin Kramer and Antonio Villaraigosa among others, "Kramer, the hedge-fund manager and Obama fund-raiser, was quiet, but others in the room were enthusiastic. Villaraigosa gave Cooperman his direct phone number. Barry Sternlicht, the founder of the W hotel chain, and an Obama donor in 2008, said that he agreed totally with Cooperman. Scaramucci, the organizer of the dinner, told me the next day that the guests had witnessed the “activation” of a “sleeper cell” of hedge-fund managers against Obama. “That’s what you see happening in the hedge-fund community, because they now have the power, because of Citizens United, to aggregate capital into political-action committees and to influence the debate,” he said. “The President has a philosophy of disdain toward wealth creation. That’s just obvious, O.K.? We talked about it all night.” He later said, “If there’s a pope of this movement, it’s Lee Cooperman.”"

You name the bank, from Wells Fargo to Citi, from BONY to BoA and they have a relationship with Ocwen. Top dogs like the Capital Group and Vanguard have a share in the Ocwen pie.

Clinching Evidence
---------------------

In his letter to Ocwen general counsel Timothy Hayes, Lawsky said an Ocwen employee had alerted a compliance executive to backdating problems about a year ago, and raised the issue again after being ignored for five months, yet the company failed to launch an appropriate investigation.

Lawsky, who runs the New York Department of Financial Services, demanded that Ocwen "fix its systems without delay."

This past June, a monitor discovered a 2012 letter, backdated 41 days, denying a loan modification. The company told the regulator over the summer it discovered the issue in April or May of 2014. It said it involved around 6,100 letters and it had changed its system to fix the problem.

"Each of these representations turned out to be false," Lawsky said in his letter.

Ocwen has faced more intense supervision from the New York regulator since February, when its proposed purchase of servicing rights on $39 billion of mortgages from Wells Fargo & Co was indefinitely halted.

Lawsky has also questioned Ocwen's business ties to affiliates, as has the U.S. Securities and Exchange Commission. The servicer disclosed that the SEC has been looking into its restated financials as well.

The New York regulator and the SEC have been coordinating parallel probes, according to a person familiar with the matter. The person was not aware of any federal authorities looking into the backdating. Spokespeople for both agencies declined comment.

Michael Bresnick, former director of President Barack Obama's Financial Fraud Task Force, said the U.S. Department of Justice might become interested in examining whether the backdating violated federal civil fraud laws.

"A central issue will be whether this was simply an isolated mistake ... or part of a larger scheme to defraud homeowners," Bresnick said.

The CFPB, an agency started at the behest of Elizabeth Warren, is also looking into and discussing the future course of action as are the Attorneys General.

Elizabeth Warren has also written to the GAO seeking a study of the non-banking loan servicing industry and the threats posed to the consumers.

What happens next will be very closely watched. Will justice be served or will Ocwen manage to get away with another gentle slap on the wrist?

Learn more -
Kappa Beta Phi - http://nymag.com/daily/intelligencer/2014/02/i-crashed-a-wall-street-secret-society.html

Cooperman's Dinner Party - http://www.newyorker.com/magazine/2012/10/08/super-rich-irony

Elizabeth Warren For President 2016

Who Will Make A Good President?
-----------------------------------

2500 years ago, sitting under the shade of a tree in the beautiful Bamboo Forest, Buddha told King Bimbisara, "When the leader of a state possesses enough understanding and love, she sees the truth about poverty, misery, and oppression. Such a person can find the means to reform the government in order to reduce the gap between rich and poor and cease the use of force against others." According to the Buddha, good leaders follow the path of virtue.

What Causes A Community To Suffer
--------------------------------------

Scarcity and discrimination cause communities to suffer. When discrimination exists based on gender, race, religion, beliefs, preferences, nationality, physical attributes etc., people suffer. When there are economic and social disparities, people suffer. If food or other necessities are scarce, people suffer. Experience of scarcity and discrimination leads to crimes and violence.

How We Become Slaves To An Economy That Exploits
-------------------------------------------------------

Habits come from perceptions. We inherit some perceptions from family, some from friends, some are a result of experiences, some come from society, media, government etc. Corporations have helped people nurture many bad habits. They communicate with the intent to increase consumption, while in reality moderation is the better option. When we become slaves, we become helpless. By the time students graduate, they are already in debt and are willing to participate in an economy that exploits their fellow citizens to repay the education loan. Then, they borrow even more. The lender ultimately decides what happens to an "asset". People are just living a life of slavery, their future is determined by the financial system.

The Super Rich Are Protected
-------------------------------

Let me give you an example. Ocwen's Chairman William Erbey has been around since the '80s. He has built an empire that cheats the government, makes people homeless, exploits employees, moves real estate inventory from individuals and families to investors, manipulates real estate prices and rent, reduces employment opportunities in the real estate industry by directing business towards their own real estate agency and title company and thus actively contributes to an economy of exploitation.
His friends, Orin Kramer and Wilbur Ross are major contributors to the Democratic Party. His friend Leon Cooperman funds the GOP. Austan Goolsbee, when he was chairman of President Obama's Council of Economic Advisers, himself met Erbey and asked him to deliver a speech on housing at the Robert F. Kennedy Center for Justice and Human Rights to discuss "the dynamics in the housing market -- what it's going to look like and how challenging it is." Eric Holder won't prosecute bankers because he has worked for them in the past and hopes to work for them again.

How To Create A Happy Nation
---------------------------------

We must cultivate good habits - reverence for life, true happiness, true love, mindful communication and mindful consumption. It is easier if conditions are conducive. Corporations are always trying to lure or pressure us into cultivating bad habits. Corporations need to be regulated at many different levels to ensure that they are not fuelling greed and creating sufferings that arise due to addiction to material goods and consumption. Education system will need to transform completely. The focus should be on learning only that much that we can remember for a long time. Focus should be on practicing mindfulness so we can deal with anger, greed, jealousy, insecurities and other negative mental formations which cause suffering. If corporations want a different kind of an education to be imparted why shouldn't they pay for it?

Elizabeth Warren For President
----------------------------------

We need leaders across the globe who aren't 'conditioned'. Leaders who will not give in to greed or aversion. Who will be mindful enough to see how one thing impacts another. Leaders of states who are willing to initiate changes that will ultimately transform greed and helplessness into love and hope. That leadership can only come from those who have already understood how the economy is exploiting humans, animals and nature.

This is why Elizabeth Warren should be President!

(I have emailed her through her senate webpage and suggest that others too email her requesting her to take up the challenge of bringing about real transformation in society by running for President.)

Demand an Attorney General who will jail the bankers!

Please follow the link and ask President Obama to appoint an Attorney General who will jail bankers!

Please fill in your details, select Justice Department and copy paste the below mentioned text on to the comment box:

"Honorable President Obama,

I am requesting you to appoint an Attorney General who is willing and able to jail bankers and foreclosure kingpins like William Erbey, Ronald Faris and William Shepro.

Banks and lenders carried through fraud to every level of the mortgage process. They committed origination fraud through faulty appraisals and undisclosed trickery.

They committed servicing fraud through illegal fees and unnecessary foreclosures.

They committed securities fraud by failing to inform investors of the poor underwriting on loans they packaged into securities.

They committed mass document fraud when they failed to follow the steps to create mortgage-backed securities, covering up with fabrications and forgeries to prove the standing to foreclose.

Justice has not been served yet. Over five million victims are waiting to see bankers and loan servicers in prison."

http://www.whitehouse.gov/contact/submit-questions-and-comments

Open Letter to Ocwen and Altisource

Dear friends,

Last week I was at a supermarket on Bangalore's busy Brigade Road when a child came up to me asking where he could find 'Mogu drinks' (a popular beverage containing nata de coco). I led him to the refrigerated food and drinks section. A few minutes later he came back to me asking me if I knew where his mom was.

In pursuit of material wealth we lose our mom, our loved ones, our home, our happiness. Not being able to find a 'Mogu drink' must have made the child a bit anxious but imagine the anxiety at not finding his mom. No 'Mogu drink' can relieve the child of that anxiety. It is time for you to find your mom, your loved ones, your home and true happiness.

I read, today, that a 6-year old from Temple, Texas, ordered for pizza under the name Thomas Jefferson, paid for it using his father's credit card and signed the receipt as 'Dad'. Prior to this he had ordered for pizza from the same outlet under the name Abraham Lincoln.

Many children use their parents' credentials, credit cards etc. perhaps sometimes without informing them. Shall we tell them that they are stealing and and that they are thieves and put them in prison? The correct way to deal with such situations is to explain to children that if they take more from mom and dad, then mom and dad will have less. Mom and dad may not have enough to pay for groceries, school fees, telephone and internet bills, medication etc. If they have less, we will have less. If they have less, they may not be able to keep their car or their home. On the other hand if they have more, they may be able to provide us a better future, better education, better lifestyle etc.

The government too helps us and protects us. If we do not pay taxes, the government will have less money to help us. If we take more from others, they will have less. If we do not contribute enough, they will have less. Many of your clients are banks, who were bailed out by the government. This helped you survive and profit. In return you spun off Altisource and headquartered Altisource in Luxembourg to avoid paying taxes. You also headquartered Altisource Asset Management Company, Altisource Residential, Newsource etc. at tax havens. So the government has less money to deal with problems like homelessness.

According to an organization, "There are 610,042 people experiencing homelessness on any given night in the United States. About 9 percent of homeless adults- 57,849 - are veterans. These numbers come from point-in-time counts, which are conducted, community by community, on a single night in January every other year."

These are people who contributed to our wellbeing. They worked for us and fought for us. They worked so we could fulfill our desires and they fought to make the world secure.

You have been instrumental in making people homeless by pursuing foreclosures and then keeping them homeless by evading taxes, thereby preventing the government from having enough money to fix the problem of homelessness.

Then, it is only fair that you stop foreclosing on loans and start providing homes to the homeless for free. You own a lot of properties through companies like Blue Valley Apartments and Altisource Residential. You can transform some of these into residential apartments and allocate them to the homeless. Thanks to modern technology mass housing projects can be completed at low cost. Materials like coated steel can also be used to construct elegant homes. According to the Tata group it is even possible to construct a house for less than $1000.

You are aware that since January, I have been trying to create awareness about your companies' practices and trying to help borrowers without charging any fees or receiving any favors in return. During the same period you have failed to admit wrongdoings and have continued foreclosing on loans and have failed to work towards providing homes to the homeless. You have, instead,been paying more money to yourselves and your lawyers. This indicates that you have not understood that if we take more from others, they will have less. If they have less, we will have less.

World leaders have shown remarkable maturity by avoiding conflict in Ukraine. If a government pays for its army to fight a war, it also leads to rise in prices of essential commodities. The people end up paying for both. That is how things impact each other.

You have been consistently chasing material wealth. Many of you have been buying homes in America but living in places like Luxembourg, while there are people who remain homeless. If we chase material desires we are separated from mom, from loved ones, from our home, from happiness. This is what I have learned from my teacher, Thich Nhat Hanh.

Please stop foreclosures immediately and provide homes to the homeless. If possible, please learn and promote the five mindfulness trainings and stop harming people, animals, natural resources and the environment.

Regards,
Saurabh Singh

How Ocwen and Altisource function

The excerpts from Ron Davis' testimony in Sealy Davis vs Ocwen FSB, Deutsche Bank et. al. (2005) provided the court a glimpse of how business processes were set up to push borrowers into foreclosure and to sell more foreclosed homes at Ocwen.

The motive behind designing those processes was the management's greed. Business processes are corporate habits. Since the motivation remains the same, the processes have only changed slightly.

The REO department has been spun off into Altisource, while LRCs remain at Ocwen (now Ocwen Loan Servicing in India). The last I knew collectors were being paid up to INR 100,000 a month as a part of the ICP. REO staff at Altisource were also being rewarded substantially through ICPs. On the other hand when I was involved with foreclosure prevention activities (short sales, deed-in-lieu, refinance) Altisource refused to pay my team and me any incentives. Most Collections/Foreclosure Consultants/REO Asset Management employees would get very low salaries but very high incentives to motivate them to foreclose and sell more foreclosed homes. Transaction Coordinators were also paid substantial incentives so they would get deeds with forged signatures and errors recorded through Premium Title (a subsidiary of Altisource), let RHSS agents like David Judd make important decisions on transactions and allow payment of real estate commissions to Ocwen subsidiaries - RESS and REO Management, LLC.

Here are the key parts of Ron Davis' testimony:

Q.(Mr. Hilliard) Mr. Davis, while you were at Ocwen, would you explain to the jury the type of training that you received in regards to dealing with customers.

A. (Ron Davis) When I first hired into Ocwen, we just hired off the street. We didn't have a training class up yet. The time line I remember,training class was 1998, '99. When we went to Orlando, Florida,from West Palm Beach,their operation there and they had a training class then. That was for collectors.

Q. And while at Ocwen, would you from time to time be given bonuses or extra money that had a particular name?

A. We got ICP programs and then extra money called bumps.

Q. Would you tell the jury what you think a bump is?

A. What I think a bump is?

Q. What you think a bump is.

A. I know what a bump is.

A. A bump is like if you lost your home to foreclosure and we had a broker list to call brokers to buy the home, we would get a bump for that extra money because they bought it. And it's called third party take out. And Ocwen paid us extra for that.

Q. Do you have any information about whether Ocwen would send payments back to customers, reject payments after they requested the payments be sent to them?

A. Yes,we did. Sometimes--

Q. Could you explain that to the jury?

A. Well, the foreclosure department needed a minimum of three payments. If they wanted to send one to us, it was our discretion to take it or send it back. We could put them on foreclosure hold for that one payment and they would send us two more later on or whatever. But we would send it back to them. We looked in the system and seen there was equity in the home,we would reject the payment and it was in foreclosure anyway and there was not time to put them on a forbearance plan,and we sent it back. Or if we didn't receive the payment, got lost or sent back,that's what we did.

......

Q. (MR. HILLIARD) Can you explain to the folks what you meant when you explained to Mr. Madole if there was equity in the house,you would choose not to modify a customer's loan?

A. That's correct. Because if there was equity,and this is based upon all the LRCs, and there's 30 of us,and we would get a bump if it went to foreclosure. We didn't have to do modification. If they didn't come up with payments to put them on forbearance, we would not do that either. We would let it go to foreclosure, get a buyer for the home.

......

Q. Could you explain to the jury what the policy was in regards to representing forbearance as a possibility and foreclosure?

A. Again, our system allowed us to go in there and plug in the numbers for percentages of the house, what the loan to value was,what Ocwen got for the home, or if it was even being serviced by another lender. It was up to us. And we did it to let it go to foreclosure or come up with the money we were asking for, including attorneys' fees and costs for our bumps,extra money in our pocket.

Q. Are you familiar with whether or not there was a policy at Ocwen to make representations that forbearance was a possibility while unbeknownst to the customer proceeding to foreclosure?

A. Yes.

Q. There was a policy?

A. Yes. We had control over the portfolio. We had 250 to 300 customers in our portfolio. We could go in, check everyone out,see which ones had equity, which ones we would put on forbearance or modify. We only had to get an X amount of deals to get our money, big money,up to 10,000 a month for bonus money. And many did.

Q. How much?

A. It's 10,000 a month.

Q. What's the most you made in a month?

A. It was $7600. One month. I was overwhelmed myself.

Q. What was your salary?

A. It was 30,000 in '96.

Q. Go ahead. Finish.

A. So, by not knowing anything,I was off the street and took the position because they offered it to me. I was a collector two years. Before I got that offer, I learned from the rest of them how to do it and what to say. And we didn't treat the people very well but the money was pretty good.

Q. So,during the time that you were there --and were you a manager at some point?

A. Supervisor.

Q. Were you familiar with the prevailing attitude that exited while you were there in regards to misleading customers?

A. Yes. I was trained.

Q. What?

A. I was, like trained by the other managers and employees how to treat the people that's -- the loans we had.

Q. Tell the jury about what you know in that regard.

A. We would call the customers and ask them what bridge they were going to live under or the next cardboard box they would have to cut out,what curb they would be kicked to,because all the belongings in Georgia went to the curb. Hey, I wasn't like that, but I learned to take the money. That was our key,the money. We had never seen the people..

Q. Once you learned how to do it,would you tell these folks how you felt about doing that?

A. I came here for that reason,
kind of like to put myself at ease. I got away from Ocwen, resigned and went to another firm, an attorney firm three hours away to get away from being like I was.

......

Q. Do you have familiarity with that situation, sending checks--telling the customer to start sending a check to a different location.

A. Yes, lockboxes.

Q. What familiarity do you have in that regard?

A. They started out with four different lock boxes in different places. The payments were getting lost. So,they changed the lockbox but the customer wouldn't get the notice before the late charges were assessed. And some went to foreclosure.

.......

Q. Let me ask you that. Were you familiar while you were there with regard to the policy of Ocwen intentionally posting payments late?

A. We posted numerous payments late.

Q. Why?

A. One,the system wouldn't accept them. We had a new program put in and it was rejecting the payments and late charges were added. And then before foreclosure, more fees were added. And that caused a lot of problems.

........

Q. Did folks in your position -- were you called an LRC?

A. Yeah, a loan resolution consultant.

Q. LRC. Did LRCs, while you were there, also get money,kickbacks from brokers?

A. Yes, they did,as well as the REO department.

Q. Would you tell the jury about that?

A. The note that -- the customer would go into foreclosure would come to our department first. We would hear -- if we couldn't put them on a plan or we refused to put them on a plan and refused their monies,and again, if there was equity, it would benefit us. If they went to foreclosure, they would go to other department we knew. And most of those were ex-LRCs. It's called real estate owned, REO. They are the ones who got the extra cash and trips and shared it with us. They were managers as well as -- well, managers, I guess.

......

Q. Let me ask you again. in regard to the question I just asked, was it a policy of Ocwen's to sometimes represent to customers that they could get a forbearance agreement while at the same time secretly move that customer towards foreclosure?

A. Yes.

......

Q. You and your colleagues, things you saw and were permanently aware of, how were your customers viewed?

A. As D&E people. Poor. Not affordable homes.

Q. Why is that significant?

A. There is a portfolio full of equity homes to benefit us for extra money, the bumps and bonuses.

......

Q. And if Sealy Davis -- one of her issues in this case is that she was promised by Ocwen that they could lower her payments,is that a type of promise you have personally made in the past to customers like her?

A. Yes, I did. I would on some of the loans that had no equity --

Q. No. After you said "yes," I have to ask you another question. So, you did that?

A. Yes.

Q. From time to time, did you do it with no intention of fulfilling that promise?

A. Yes, I did. I couldn't find the payments, yes. So they went foreclosure.

......

Q. (Mr. Madole) You said that you personally, Ron Davis, would pick up a phone,call a borrower and say, "I will give you a forbearance plan."  And in your secret heart, you would say, "Ha, ha, no." That's the way you were?

A. That's the way we were.

.....

Q. (Mr. Hilliard) Let me ask you, who is Bill Erbey?

A. He is the owner of Ocwen Federal Bank.

Q. Did you ever attend any meetings with Bill Erbey?

A. Yes. Luncheons we would call it.

Q. During those luncheons did Mr. Erbey ever set out for you his view of how Ocwen should conduct business?

A. Yes. Due to the type of paper, again we're back to the D&E paper that he bought from HUD and other Loan Servicing accounts that these are people that have no money, probably won't have no money to get their houses back out of foreclosure. There are some that have equity which would help build your bonus structure,and that was at the Palm Beach Lake address.

.....

Q. While you were there, did Ocwen from time to time or folks who worked with customers from time to time doctor the comment history log?

A. Yes, we did. We changed the financials a lot.

Q. Explain it to these folks.

A. If the loan had, based on no equity, a lifeless loan, we would call it,we would change it to add more food, more electricity,any expense that would be for the home. If they put down cable,we would tell them we would erase it. That didn't count towards the affordability of their payment. So,we helped them with their financials based on the equity in the home, the amount of equity. That's what we did. 

Q. You mentioned some times you would call a customer how many times a day?

A. The dialer would call the customer. Automated dialer. Put headsets on, it would ring the phone six, seven times a day, because the program wasn't working correctly.  And got OTS complaints from the banking commission and the Attorney General and the consumer people because we harassed them too many times.

Ocwen's lower earnings can lead to more problems

Ocwen shareholders and in particular, small investors, experienced significant losses yesterday as the Ocwen (OCN) stock hit a new 52 week low of $30.16 before closing at $30.17. The stock registered a decline of 12.95% in a single day! Small investors and traders who had invested in the OCN stock, in part due to recommendations from various analysts, were severely impacted by the fall.

The Altisource Asset Management Company (AAMC) stock shed 12.39%, Altisource Portfolio (ASPS) lost 8.69% while Altisource Residential (RESI) ended the day 5.73% lower.

The results have been in line with our expectations. We had advised that Altisource (ASPS) are beneficiaries of sweetened deals handed out to them by OCN and AAMC and in return provide poor service to OCN, AAMC, RESI and their customers. So no surprises, then, that ASPS profited at OCN, AAMC and RESI's expense.

Ocwen's slide appears to have only just begun. With lower working capital and higher interest costs, OCN could soon find itself facing newer challenges.

William Erbey rued the fact that Ocwen were being made to adhere to regulatory requirements and advised that this had increased the costs. Ronald Faris made a case for greater CFPB involvement by presenting various statistics that according to him indicated that more homeowners were able to keep their homes since CFPB began monitoring OCN's activities.

In the meanwhile, we are demanding action against William Erbey, Ronald Faris and William Shepro, in addition to other Ocwen and Altisource officials for consciously formulating and engaging in business practices that have adversely impacted homeowners, investors, shareholders, employees and the Government.

If you would like to help, please write to regulatory authorities like the CFPB, Department of Financial Services (New York), your state's Attorney General's office and lawmakers requesting immediate action against these individuals.

CFPB - Third Anniversary

The Consumer Financial Protection Bureau celebrated their third anniversary yesterday. They protect people from antisocial and predatory organizations like Ocwen and Altisource. I hope they help many more people in the years to come.

Why must we end foreclosures?

Looking deeply we can see that the borrower is the victim. It is naive to say that the lender foreclosed on the loan because the borrower defaulted. According to my teacher, Thich Nhat Hanh, "The manifestation of something or someone does not rely on one condition alone; it relies on many conditions. So, the idea that one cause can bring about the effect is not correct. One cause is never enough to help something manifest." So we must look further to see what else contributes to bring about a foreclosure. Perhaps then we will understand why I say that the borrower is the victim.

The valuation of the property is a very important factor along with financial hardship. In fact sometimes borrowers just stop repayments because it just doesn't make sense to pay an inflated price for a property when they can buy a better home for less. Even then the borrower is not at fault.

Lenders hire qualified individuals as underwriters and property appraisers who make the all-important decision of how much can be advanced to a borrower. It is the underwriter who assesses the financial qualifications of the borrower. Mind you, the lenders don't really look for poor, homeless, jobless individuals as customers. They look for individuals and families who can save enough every month to repay an amount that will be advanced to them which is determined by the lender. The amount of money that can be advanced to the borrower is capped at a certain percentage of the value of the property that will serve as the collateral. It is the lender, through its chosen property appraiser who determines the value of the property.

So we can see that the lender is not really providing housing to the homeless, jobless who really need financial assistance to buy a home more than anyone else but in fact are selling a product to those who they think can afford it. They are looking to profit. It is important to keep this in mind. They determine what you can borrow and they determine what the collateral is worth and they are looking to profit. You, as a borrower, are just participating in good faith, buying a shelter for your family. So your child can have his own room.

A few years later the old appraisal report is replaced with a new one and it is determined that your property is now worth much lesser than what it was initially appraised at. In fact, the outstanding balance on the mortgage is more than what the property is  worth. Your mortgage is now what is known as an "underwater" mortgage. Enter Ocwen, very eager to buy such loans.

In case, the borrower continues with repayments as usual, not only does the borrower end up paying a lot more for the house than what it is worth but also has to deal with Ocwen every month to make sure she is getting her statements on time and that her payments are being applied appropriately and on time. She may also find that her monthly mortgage repayments are now higher thanks to Ocwen adding expensive insurance or other fees. The borrower is the victim. The borrower ended up paying much more for property than what it was worth because of the lender's inability to value the property accurately.

Either due to reduced monthly savings generally caused by reduction in income or increase in expenses (many times due to medical reasons) or simply because the property is worth much less, the borrower who wishes to keep her home asks the loan servicer, Ocwen, to consider reducing the outstanding principal in line with the reduction in home value. Ocwen will advise the borrower that they consider loan modification requests only on delinquent accounts, pushing the borrower into defaulting. Once the borrower has defaulted, Ocwen add up enough on to the statement like late fees and property inspection fees etc. to ensure that the borrower cannot catch up any more. They simultaneously begin foreclosure proceedings. In the event that the property is located in nonjudicial foreclosure state like California the borrower faces a race against time to keep her home.

The common ownership of Ocwen and Altisource have little to gain from a loan mod or a short sale but have lot to gain from foreclosure. Altisource stand to earn Buyer's Premium, Listing commissions, Web Technology Fee, Title and Escrow fees, Property Preservation Fees, Closing Coordination Fees and more! They also earn fees to process foreclosures on behalf of Ocwen in states like California. They also earn property inspection fees and may source appraisal reports through their own unit Springhouse AMC.

Looking deeper we can also see that companies like Altisource Residential buy loans for much lower than what the underlying security is worth. So if they foreclose and sell the home, apart from Altisource earning these fees, they would also make a "tax free" profit! Its much like buying and selling homes for profit, only it is tax free. Foreclosure wipes out junior liens and judgments from title and also either completely wipes out or reduces the HOA dues. This makes it even more profitable to foreclose.

With rising "REO to Rental" activity we can see that it acts as a strong motivation to foreclose. With buying a house becoming almost unaffordable in places like San Fransisco demand for rental properties is rising and it provides better return than a loan modification.

If we are mindful we can see that there is no reason to reject a short sale and foreclose unless Ocwen are working to benefit Altisource. As a part of the Ocwen's Assisted Short Sale Program properties are listed on HUBZU.com. So all they need to do is go with the best offer. However, we can see that foreclosing and selling the property will make more money for Altisource. So we can see why they will reject the short sale and foreclose instead.

The borrower has the odds stacked against her in all scenarios. Even in the case where the borrower just walks away, it is the loan servicer at fault for failing to counsel the borrower appropriately. For failing to highlight the alternatives to the borrower.

"According to Vijñaptimatra Buddhism, there are two minds and three natures of reality. The deluded mind is the cause of all sufferings - the first link of the twelve links in the cycle of Interdependent Co-arising. This cycle is know as the cycle of birth and death and the nature of reality perceived under the influence of the deluded mind is known as parikalpit svabhav - Samsara. In Samsara there is parting, dissatisfaction and misunderstanding.

The other mind, the true mind, creates a world of suchness. There is no birth and death. No coming, no going. No after, no before. No one, no many. No existence, no non existence. It is complete, lacking nothing. This nature of reality is known as nishpanna svabhav - Nirvana. In Nirvana, there is no parting. There is satisfaction and understanding.

Deluded mind creates suffering. True mind creates happiness. The link between the two is paratantra svabhav - interdependence. So in order to reach the shores of nishpanna svabhav, we must go through the world of interdependence. We must constantly learn to see everything in the light of interdependence. We develop our mindfulness to enable us to constantly see the interdependent nature of things."

Vijñaptimatra Buddhism For Dummies

When we see the borrower's plight in the light of such conditions as highlighted above, we are already in the realm of paratantra svabhav. We can clearly see that the borrower is the victim and it is unethical to foreclose. When we look at things like this we are only a step away from ending foreclosures and what a relief that will be for homeowners! They only thing that stands in our way is the greed of individuals and corporations like William Erbey and Altisource. So they must be dealt with.

Let us work together, mindfully, towards the goal of ending foreclosures. Mindfulness will always keep us on the right track.

(The author, Saurabh Singh, is a student of the Buddhist monk Thich Nhat Hanh. He is a Foreclosure Prevention Activist and a vegan. He is also a member of People for Ethical Treatment of Animals(India), Consumer Advocates in American Real Estate, UNITES Professionals and supports various charitable causes and crowdfunding.)

Bill Erbey's Grand Designs

He sets up his companies at locations like Luxembourg, US Virgin Islands and Bermuda so they can save on taxes. He sets up companies like Altisource whose fortune depends on others' misfortune. Ocwen and Altisource Chairman, William Erbey, represents everything that is bad about our society today.

At a time when his country was struggling to deal with a recession that was brought about by a subprime mortgage crisis, Erbey found ways to contribute as little as possible to the government. Not only did he set up his companies at tax havens, he, in fact designed lines of businesses that seek to profit from his countrymen's misfortunes. Erbey champions a society that's driven by greed.

Twenty-six of the most powerful American corporations – such as Boeing, General Electric, and Verizon – paid no federal income tax from 2008 to 2012, according to a new report, conducted by public advocacy group Citizens for Tax Justice (CTJ), detailing how Fortune 500 companies exploit tax breaks and loopholes.

According to Cahir O'Doherty, " Everything connects: the bonanza being enjoyed by America’s super-rich is directly related to the drop in their tax rates - and as they prosper the public purse empties, so the nation faces devastating budget squeezes and the slashing of vital public services for the middle class and the poor.

Of course money doesn't grow on trees, but nor does it trickle down from rich men's pockets. But paying taxes is an obligation of citizenship, or it once was. If the rich want to escape their obligations to this nation or take their money abroad the better to hide it they should also lose their right to call themselves American citizens."

Bill Erbey's companies, Ocwen Financial Corporation (OCN) and Altisource Portfolio Solutions (ASPS), first induce default and push borrowers towards foreclosure then sell these foreclosed homes through their website HUBZU.com to earn Buyer's Premium, Listing Commissions, Title and Escrow Fees, Property Preservation Fees, Web Technology Fees, Closing Coordination Fees and more! In what is a direct conflict of interest between Ocwen's investors and Altisource, Altisource execute real estate purchase contracts on behalf of Ocwen paying themselves Title insurance and related search fees (to Premium Title, an Altisource company), Property Preservation Fees, Closing Coordination Fees etc.

Altisource Residential (RESI) intend to acquire single family residential homes, renovate them and rent them out. Only they don't buy any properties. They buy non-performing loans. Altisource Asset Management Company (AAMC) acquires and manages nonperforming loans on behalf of Altisource Residential (RESI). A majority of these will end up being foreclosed so they can be rented out or sold through HUBZU.com for a profit! Add to that the fees they will earn... more money! They clearly have vested interests in foreclosing homes!

Real estate agents are losing their inventory to Altisource who also function as a listing agency through their unit Real Home Servicing and Solutions. Title insurance revenues are being driven to NewSource, a company which has no employees! AAMC own 100% of shares with voting rights of NewSource and RESI own 100% of non-voting right shares. NewSource pay Altisource (ASPS) a performance fee of 90% of the net income after paying out a preferred dividend of 12% to RESI.

People have been pushed into defaulting by Ocwen who put unauthorized insurance fees and other charges depleting ordinary, unsuspecting people's escrow balance and making their monthly mortgage repayments unaffordable. Ocwen are notorious for not applying payments on time and then asking for late fees.  According to the data made available by the Departments of Treasury and Housing and Urban Development, Ocwen approved 23% of the modifications they processed under HAMP since the program's inception. Compare this with Bank of America's 44%, CitiMortgage's 43% and Wells Fargo's 35%. So they are not exactly pushing loan mods, neither are they pushing short sales. They are just looking to foreclose so Altisource can profit! Borrowers are being subjected to a nightmare.

How will we heal the wounds of the people who have suffered at the hands of Bill Erbey and his companies?

(The author, Saurabh Singh, is a student of the Buddhist monk Thich Nhat Hanh. He is a Foreclosure Prevention Activist and a vegan. He is also a member of People for Ethical Treatment of Animals(India), Consumer Advocates in American Real Estate, UNITES Professionals and supports various charitable causes and crowdfunding.)

Designing your campaign to win justice for Ocwen-Altisource victims

Many have been hurt by Ocwen and Altisource. People who have lost their homes - families, single moms, children, senior citizens. Realtors have been hurt. Vendors, buyers, employees.... the list goes on. Those who are blinded by greed deny others what is rightfully theirs. If more money can be made by paying employees poorly, then why not? If more money can be made by squeezing something out of a poor realtor's commission, why not? That is how they think - those who are driven by greed. They snatch from others what does not belong to them - homes, ideas, intellectual wealth, customers... This is theft. This is a crime. It promotes social inequality. Victims experience sorrow and despair and many loose their faith in natural justice.

The victims of Ocwen-Altisource have thus far obtained little success. Most have given up. Some think they are too small to make a difference. Some think that no one will help them. Some just have to give up because it isn't financially feasible to fight Ocwen-Altisource.

Must we then give up? Should we not help our sisters who are on the verge of being forced out of their homes? Those very realtor friends who stood by us, recommended us, helped us in many ways now face a future of uncertainty as Altisource craft strategies to snatch their inventory. Move over Mrs. Hudson, Sherlock Holmes will now live in an Altisource rental home! Perhaps plans are in place to remake "The Apartment", with Baxter now living in an Altisource rental home! They have money, staff, attorneys, PR firms... what do we have?

We have the five powers. Faith, energy, mindfulness, concentration and understanding. Using these we can help others and ourselves.

Are you too small to make a difference? "If you think you are too small to make difference, try sleeping with a mosquito." A small mosquito can cause a lot of trouble, even malaria. Have faith in your abilities.

When contacting regulatory authorities, attorney generals, congressmen etc. you will need to keep in mind that they are not Realtors or employees of Altisource. You may need to simplify Ocwen-Altisource's complex business structure and explain how it is designed to promote foreclosures. And you will have to do this repeatedly. Does your congressman know much about OMAT 1 REO Holdings or Blue Valley Apartments or HLSS or NewSource? Possibly not. Ocwen-Altisource have designed a business structure that can confuse even very experienced analysts. Government officials are busy people who may not know much about loan servicing and Ocwen and Altisource.

You may use information available here:
http://themisplacedphilosopher.blogspot.in/2014/02/how-ocwen-altisource-are-hurting.html

And here:
http://themisplacedphilosopher.blogspot.in/2014/02/you-may-take-your-ocwen-complaints-to.html

We will need to create awareness about Ocwen-Altisource among lawmakers, regulators, media-men and people in general. If you wish to help, spend 30 minutes in a day writing to people who matter in your state or to people at CFPB or DFS or media-men explaining how you have been hurt by Ocwen-Altisource's predatory practices. Explain how this will hurt your community. You will need energy. It comes from faith.

In India, if you submit rent receipts and proof showing investment in certain types of financial instruments, you can save on the amount of tax you are required to pay. I have never done that believing that the more tax we pay, the more we strengthen our nation. My friends at Altisource group of companies remind me that they are headquartered in Luxembourg and US Virgin Islands so they can save on taxes! They certainly don't think like me.

Please do spend some time to help heal the wounds people have suffered at the hands of Ocwen-Altisource and help prevent others from experiencing the same fate. If we are mindful, we can make a lot of difference. Concentration will develop. With concentration, understanding will develop. Looking deeply we will know all there is to know. To be free. To be happy and to make others happy.

(The author, Saurabh Singh, is a student of the Buddhist monk Thich Nhat Hanh. He is a Foreclosure Prevention Activist and a vegan. He is also a member of People for Ethical Treatment of Animals(India), Consumer Advocates in American Real Estate, UNITES Professionals and supports various charitable causes and crowdfunding.)