BOSTON, Aug. 12, 2014 /PRNewswire/ -- Shares in Ocwen Financial Corp. ("Ocwen" or the "Company") (NYSE: OCN) have plunged precipitously on news that the Company has initiated an investigation of its internal and accounting controls, and anticipates restating its financial results for at least the first quarter of 2014 and all of 2013. The Company stated that there may be material weakness in how it accounted for particular transactions, particularly the sale of mortgage-servicing rights to Home Loan Servicing Solutions Ltd.
The first indication of the irregularities came when Benjamin Lawsky, superintendent of New York's Department of Financial Services, in his role as the top financial regulator for New York state, sent a letter on August 4, 2014, to Ocwen questioning regular payments the company indirectly makes to Altisource Portfolio Solutions SA, ("Altisource"). Altisource is owned by Ocwen officials. Lawsky intimated that Ocwen may be funneling as much as $65 million in questionable fees to one of its affiliates, and expressed concern that Altisource will generate significant revenue for the Company without performing any value-adding services. Additionally, Ocwen's executive chairman William Erbey apparently played a significant role in personally approving the payments to Altisource, in direct contrast with his repeated representations that he recuses himself from decisions involving affiliates. The Company followed up the news of Lawsky's investigation with its August 12 announcement that it would restate its financials for at least the previous five quarters.
Block & Leviton LLP is investigating the Company and certain of its officers and directors to determine how widespread any potential accounting violations extend and whether any insiders at the Company such as Mr. Erbey personally profited by the alleged accounting improprieties.
If you purchased Ocwen stock and have questions about your legal rights, or if you have information relevant to this investigation, please contact attorney Steven Harte of Block & Leviton LLP at (617) 398-5600 or at Steven@blockesq.com. Confidentiality to any whistleblowers or other persons with information relevant to the investigation is assured.
Block & Leviton is a Boston-based law firm representing investors for violations of securities laws. The firm's lawyers have collectively been prosecuting securities cases on behalf of investors for over 70 years.
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Contact: BLOCK & LEVITON LLP Steven Harte (617) 398-5600 Steven@blockesq.com
SOURCE Block & Leviton LLP