DOJ Joins Another Suit to Challenge Constitutionality of CFPB
Mortgage servicer Ocwen Financial will have support in its bid to have the structure of the Consumer Financial Protection Bureau (CFPB) declared unconstitutional after a Florida judge recently ruled that the U.S. Attorney General’s office could provide its views on the matter to the court. The service provider is currently being sued by the CFPB for using incomplete data to initiate foreclosure proceeds on thousands of homes. Ocwen was previously required to offer $2 billion in relief to borrowers for the company’s failure to apply mortgage payments to accounts correctly, the charging of excessive default-related fees, and the forced imposition of insurance on customers.
This case is the second instance in which the Department of Justice (DOJ) has intervened in the debate over the structure of the CFPB. The DOJ joined another mortgage servicer, PHH Corp., in March by filing an amicus brief in support of the company’s argument that the single independent director structure of the CFPB violated the U.S. Constitution. That case is currently pending a decision by the en banc panel of D.C. Circuit judges. Earlier this week a Pennsylvania judge ruled the CFPB’s structure was constitutional.