HUD inspector general subpoenas Ocwen over force-placed insurance
Ocwen Financial Corp. has received a subpoena from the Department of Housing and Urban Development Office of Inspector General regarding force-placed hazard insurance.
The April subpoena requested documentation related to lender-placed insurance arrangements and the amounts paid for such insurance, the company revealed in its first-quarter 10-Q filing.
But Ocwen said it is not the only company the HUD-OIG has requested information from. There were no allegations against Ocwen in the subpoena, the 10-Q filing said.
"We are fully cooperating with the Office of Inspector General of HUD. We understand other servicers in the industry have also received similar subpoenas," added Ocwen spokesman John Lovallo in a statement.
The West Palm Beach, Fla.-based company is being sued by the Consumer Financial Protection Bureau over its servicing practices. The April 20 lawsuit included allegations that it mishandled hazard insurance premium payments from escrow accounts.
"Ocwen's failures led to the lapse of homeowners' insurance coverage for more than 10,000 borrowers. Some borrowers were pushed into force-placed insurance," the CFPB press release announcing the suit said.
A request for further information from HUD-OIG regarding the other companies involved has not been returned.