Federal Judge Weighs in on CFPB’s Ocwen Suit

first_img According to a Florida federal judge, the Consumer Financial Protection Bureau (CFPB) is constitutionally structured, meaning an enforcement action against Ocwen Financial Corporation will not end on those grounds, even after the CFPB itself has officially adopted the legal position that its structure is constitutionally flawed, Law360 reports.U.S. District Judge Kenneth A. Marra found other grounds for dismissal in September when he booted the suit that accuses Ocwen of widespread mortgage servicing failures but gave the CFPB a chance to amend its claims after rejecting Ocwen’s argument that the agency is unconstitutionally structured and therefore lacks proper authority to pursue the lawsuit.CFPB Director Kathleen Kraninger reversed the Bureau’s course and agreed that the “for-cause” removal provision, which states that the president can only remove CFPB’s director for “inefficiency, neglect of duty or malfeasance in office,” does violate the U.S. Constitution’s separation of powers, according to a brief filed earlier this year in the high court by U.S. Solicitor General Noel Francisco and in letters sent to Congress.Judge Marra said the agency’s pivot does not change his view of the case, after Ocwen asked the court last month to reconsider the dismissal after the agency officially adopted the legal position that its structure, and specifically the “for-cause removal” protection afforded to its director, is in fact constitutionally flawed.”That the CFPB has shifted its own position does not discharge the court of its duty to interpret the constitutionality of [the removal protection] independently,” the judge said. “Even assuming arguendo that the CFPB’s structure is found to be unconstitutional, the proper remedy would be severing the unconstitutional removal provision, not dismissal of the case with prejudice.”The CFPB has already amended its 2017 lawsuit against Ocwen, which alleges a host of problems with the company’s servicing practices during the early and mid-2010s and was brought the same day that Florida state authorities filed their own lawsuit against the company in the same court. Share Save Tagged with: CFPB Constitutionality Ocwen Seth Welborn is a Reporter for DS News and MReport. A graduate of Harding University, he has covered numerous topics across the real estate and default servicing industries. Additionally, he has written B2B marketing copy for Dallas-based companies such as AT&T. An East Texas Native, he also works part-time as a photographer. CFPB Constitutionality Ocwen 2019-11-14 Seth Welborn Demand Propels Home Prices Upward 2 days ago Servicers Navigate the Post-Pandemic World 2 days ago The Best Markets For Residential Property Investors 2 days ago The Week Ahead: Nearing the Forbearance Exit 2 days ago Previous: Preparing Banks for National Flood Insurance Program Deadline Next: Mortgage Delinquency by State Demand Propels Home Prices Upward 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago Related Articles Federal Judge Weighs in on CFPB’s Ocwen Suitcenter_img Governmental Measures Target Expanded Access to Affordable Housing 2 days ago Data Provider Black Knight to Acquire Top of Mind 2 days ago in Daily Dose, Featured, Government, News Subscribe Sign up for DS News Daily Home / Daily Dose / Federal Judge Weighs in on CFPB’s Ocwen Suit Servicers Navigate the Post-Pandemic World 2 days ago November 14, 2019 2,422 Views The Best Markets For Residential Property Investors 2 days ago  Print This Post Governmental Measures Target Expanded Access to Affordable Housing 2 days ago About Author: Seth Welbornlast_img

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