Ocwen Financial is able to keep the answers to questions from the Consumer Financial Protection Bureau involving the improper handling of escrow accounts confidential, a federal magistrate ruled.
The CFPB had argued that Ocwen's narrative answers to how it managed escrow accounts should not be kept under seal because of the substantial public interest in the government's enforcement action and because they did not contain trade secrets, Magistrate Judge William Matthewman noted in his ruling in a case being tried in the U.S District Court for the Southern District of Florida.
In its response, Ocwen replied several answers contained sensitive personal information along with disclosing the mortgage servicer's internal procedures for performing and reviewing its control functions. The judge agreed.
"The Court has already determined that there is no common-law right of access to discovery and therefore the public's interest in the documents do not outweigh Defendants' interest in keeping the documents confidential at this time," Matthewman wrote. "Further, in balancing Defendants' request to keep the answers confidential at this juncture of the case with Plaintiff's burden in filing sealed discovery motions, the Court finds that the narrative answers should remain confidential at the discovery phase of litigation."
Ocwen previously entered into settlements with most of the state regulators and attorneys general after they sued the company on similar grounds. As part of its response to this case filing in April 2017, Ocwen challenged the constitutionality of the CFPB.
A federal judge in New York ruled on June 21 that the CFPB's structure was unconstitutional. The U.S. Court of Appeals for the D.C. Circuit had said in January that the bureau's structure was constitutional.
Separately, John Britti is stepping in as Ocwen's interim chief executive, keeping the seat warm for Glen Messina, who will take the top job at Ocwen once it closes its deal to acquire PHH.
Ron Faris was with Ocwen for 27 years, servicing as president since 2001 and adding the CEO title in 2010. He announced his plan to leave the company effective June 30 back in April, which created a gap before Messina, the former PHH chief executive, is set to join Ocwen.
In addition to Faris' departure, former chief financial officer Michael Bourque left the company on June 22.
Britti has been Ocwen's executive vice president and chief investment officer since June 2014, and will retain those roles while serving as the interim CEO starting on July 1, the company said in a Securities and Exchange Commission filing. He was also the interim head of risk management at Ocwen from September 2016 to February 2017.
Previously, he served as chief financial officer from March 2012 to June 2014, and was the EVP responsible for finance and business development from January 2011 to March 2012.
Before joining Ocwen, Britti was the chief operating officer for Republic Mortgage Insurance Co. from 2005 to 2011, leaving before the company stopped writing new policies in September of that year.
He is a former vice president at Freddie Mac, where he managed its community lending sales efforts and customer relationships starting in 2004. From 1994 to 1998, he was a vice president of pricing and structured transactions. In between those jobs at Freddie Mac, he was a vice president at Capital One running the thrift and mortgage operations.