NEW YORK (TheStreet) -- Shares of Ocwen Financial Corp. (OCN) are down -3.38% to $25.45 as the largest non-bank mortgage servicer said investors shouldn't rely on its financial statements as the firm’s auditor reviews accounting controls, Bloomberg reports.
Ocwen shares have fallen 50% in the past 12 months,compared with a 15% gain for the 1,033-company benchmark. The company said it plans to restate results and delayed its quarterly filing for the three months ended June 30, Bloomberg said.
There may be “material weakness” in the firm’s accounting for how it booked a sale of mortgage-servicing rights to Home Loan Servicing Solutions Ltd., Ocwen said in a regulatory filing. Pretax income for 2013 probably increased by $17 million and declined by the same amount in this year’s first quarter, according to the filing.
“The company anticipates it will determine that a material weakness existed in the relevant time periods in the adequacy of our controls,” Ocwen said in the filing.
The superintendent of New York State’s Department of Financial Services is reviewing Ocwen’s arrangement with Altisource Portfolio Solutions, which he said may be designed to funnel fees to an affiliate for minimal work, Bloomberg noted. Ocwen declined to comment on Lawsky’s review earlier this month.
TheStreet Ratings team rates OCWEN FINANCIAL CORP as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation: