The Ocwen Way: of India and the Cayman Islands

Is outsourcing American jobs -- white collar jobs, no less -- evil? Is it a bad thing to set up a servicing acquisition company in the Caymans because by doing so you can avoid paying both income taxes to your executives and corporate income tax? Both issues pertain directly to Ocwen Financial Corp., that fast growing servicer/subservicer which is gobbling up distressed mortgage servicing rights on the cheap, and using back office workers in Bangalore to process loans. Recently OFC executives created a new company in the Cayman Islands whose sole mission in life is to buy MSRs from Ocwen. It's all legal and “evil” is, perhaps, not the best word. I've received several angry emails from mortgage workers protesting Ocwen's outsourcing practices, complaining about the loss of American jobs. I won't pass judgment on Ocwen but I recall about 10 years ago interviewing former Countrywide Financial CEO Angelo Mozilo about the topic. Initially, he told me that CFC would never do such a thing because he felt it was counterproductive -- that his firm was in the business of making mortgages to Americans with jobs here in the U.S. Of course, about a year after that interview CFC opened a call center in India and began growing that operation. When I asked Mozilo about the change of heart, he groaned. He didn't really want to do it but the cost savings was too great to pass up.