NEW YORK (TheStreet) -- Bill Erbey made more than $2 billion building what looked like a better mousetrap for collecting mortgage debt, but much of that fortune vanished in 2014 and on Monday Erbey was forced to resign as chairman of five companies he oversaw.
Even Ocwen Financial (OCN) , the best known of Erbey's companies, isn't exactly a household name, but in just a few years it became the largest collector of overdue mortgage debt in the U.S.
A workaholic former General Electric (GE) executive with a dry sense of humor and a passion for technology, Erbey, 65, started Ocwen in the 1980s from a collection of troubled banking assets. The mortgage-boom years of the early 2000s weren't good for Ocwen since few people ran into trouble paying their mortgage bills.
But Erbey was ready when the financial crisis hit. During a Jan. 26, 2007, earnings call, Erbey predicted Ocwen would "have somewhat of an advantage as losses continue to rise simply because we have, with our technology, the ability to expand capacity very quickly. I think the industry, because of a lack of collectors, will find it very difficult if delinquencies pick up materially to actually keep pace with having a sufficient number of people to actually process the loans."
Erbey was effectively predicting the rise of "robosigning" and other bad behavior by the largest collectors of mortgage debt, which at the time were all big banks like Bank of America (BAC) , Wells Fargo (WFC) , JPMorgan Chase (JPM) and others now out of business.