Magazine article American Banker

Court Keeps Ocwen Records Sealed in CFPB Dispute over Escrow Accounts

Magazine article American Banker

Court Keeps Ocwen Records Sealed in CFPB Dispute over Escrow Accounts

Article excerpt

Byline: Brad Finkelstein

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. …

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