Ocwen Loan Servicing, a subsidiary of Ocwen Financial, reached a $17.5 million settlement that covers a pair of lawsuits that accused Ocwen of calling consumers’ cellphones without their consent, in violation of the Telephone Consumer Protection Act.
The settlement ends two putative class actions that alleged that Ocwen knowingly and willfully violated the Telephone Consumer Protection Act by using an automated telephone dialing system to call people’s cellphones without consent.
The settlement was first reported by Law360, which stated that the putative class includes more than 1.6 million consumers.
Under the terms of the settlement, eligible consumers would receive between $55 and $90, Law360 reported.
In a statement, Ocwen spokesperson John Lovallo confirmed that the company reached a settlement, and stated that Ocwen agreed to the settlement to put the matter behind it.
“As disclosed in the company’s US Securities and Exchange Commission Form 10-Q on August 3, 2017, Ocwen reached a settlement in principle to resolve this matter in July,” Lovallo said. “While the company believes that it had sound legal and factual defenses, Ocwen agreed to this settlement to avoid the uncertain outcome of litigation and the additional expense and demands on the time of its senior management that such litigation would involve.”
As Lovallo said, Ocwen disclosed the initial settlement agreement in its third quarter 10-Q filing with the SEC.
In Ocwen’s filing, the company stated that the settlement will include the establishment of a settlement fund to be distributed to impacted borrowers that submit claims for settlement benefits.
Ocwen did not disclose the size of the settlement, stating that it accrued funds to cover the settlement as part of $86.1 million set aside for litigation.
“We cannot currently estimate the amount, if any, of reasonably possible loss above the amount accrued,” Ocwen said in the 10-Q.
