The Consumer Financial Protection Bureau (CFPB) sent out a public notice that it is looking into lender and servicer Mr. Cooper for unauthorized withdrawals from consumers.
Unauthorized duplicate-payment drafts by Mr. Cooper appear to have resulted in hundreds of thousands of consumers’ bank accounts being debited for multiples of their mortgage payments. Affected consumers have reported being charged overdraft fees and likely suffered additional harm as a result of these unauthorized withdrawals.
“The CFPB is taking immediate action to understand and resolve the situation that has affected hundreds of thousands of consumers,” CFPB Acting Director Dave Uejio said. “The CFPB will use all appropriate tools at our disposal to help ensure harmed consumers receive relief. Consumers affected by the incident should monitor their accounts and may contact Mr. Cooper directly.”
Mr. Cooper announced to consumers Tuesday that it discovered a payment processing issue Saturday at its electronic payments vendor resulted in a number of our customers experiencing incorrect mortgage payment drafts from their bank account.
“We worked over the weekend with the banks involved to reverse the transactions as quickly as possible,” Mr. Cooper said in a statement. “Certain banks processed the incorrect payments on Saturday and temporary credits were reflected the same day. Other banks processed the payments on Monday, April 26, and the reversals will be reflected on customers’ bank accounts the same day.
“In fewer instances and depending on the financial institution, payments or reversals will be reflected on Tuesday, April 27,” it continued. “All inaccurate charges are being corrected, and any impacted customers will not be responsible for any fees or other negative financial impact this may have caused.”
Mr. Cooper apologized for the incident, and said it will continue to work with the payments vendor to understand the root cause and ensure the issue does not happen again.
This is not the first time Mr. Cooper has had a run-in with the CFPB. Back in December, the CFPB and multiple states entered into a settlement with Mr. Cooper, previously known as Nationstar Mortgage, for unlawful servicing practices.
The proposed judgment and order, if entered by the court, would require Nationstar to pay approximately $73 million in redress to more than 40,000 harmed borrowers. It would also require Nationstar to pay a $1.5 million civil penalty to the bureau.