NEW YORK (TheStreet) -- Investors in PennyMac Financial Services (PFSI) have turned a blind eye to the regulatory storm that has sent Ocwen Financial (OCN) shares down 74% this year, but the particulars of Ocwen's settlement with regulators on Monday ought to give them pause.
In some ways, that isn't surprising: Ocwen, Nationstar and Walter are often lumped together. If they are brothers, PennyMac is the cousin.
But PennyMac resembles Ocwen in certain ways that might make its investors uncomfortable if they thought about the risks more carefully.
Ocwen's Chairman, Bill Erbey, was chairman of four interrelated publicly traded companies until he was forced to resign from all of them as part of a settlement Monday with the New York Department of Financial Services.
In explaining the rationale for Erbey's resignation, the NYDFS cited various conflicts of interest between his roles overseeing Ocwen and related companies such as Altisource Portfolio Solutions (ASPS) .
Just as Erbey wore many supervisory hats, PennyMac's top two executives, Chairman and CEO Stanford Kurland and President and COO David Spector, hold those same positions at a related real estate investment trust, PennyMac Mortgage Investment Trust (PMT) .
Both PennyMac companies acknowledge the potential for conflicts of interest among the risks cited in their annual 10-K regulatory filings.
Christopher Oltmann, a spokesman for both companies, said the company would have no comment on any parallels between it and Ocwen.