Press Release  AG Healey Secures $550,000 from Company that Illegally Profited from Distressed Homeowners in Massachusetts

Boston — Attorney General Maura Healey today announced a company that provides pre-foreclosure property preservation services will pay $550,000 and change its business practices to resolve allegations that it unfairly and illegally profited from distressed Massachusetts homeowners in violation of state consumer protection laws.

The assurance of discontinuance, filed in Suffolk Superior Court, resolves allegations that Altisource Solutions Inc. performed unnecessary and duplicative pre-foreclosure inspections and property maintenance services. The company also received improper commissions for procuring force-placed insurance policies on behalf of the mortgage servicer Ocwen Loan Servicing LLC. Altisource then passed the costs of these unnecessary services and commissions on to the accounts of distressed homeowners through Ocwen.

“Altisource, through its close relationship with Ocwen, unfairly profited from charging homeowners for expensive and duplicative coverage and services that they did not need,” said AG Healey. “This settlement will provide relief to borrowers and require the company to change its practices going forward.”

In Massachusetts, Altisource provides exclusive property preservation services to Ocwen for the purpose of protecting the mortgagee’s interest in a distressed property. When a homeowner defaults on their mortgage payments, Altisource conducts regular property inspections to determine if the property is occupied or being maintained. Altisource also performs maintenance on the property ranging from grass cuts and snow shoveling, to major repairs and winterization.

Until 2009, Altisource’s parent company was a subsidiary of Ocwen. The AG’s Office began investigating Altisource after filing a lawsuit against Ocwen alleging that it charged homeowners unnecessary property preservation fees, failed to comply with homeowners account dispute processes, failed to properly administer insurance escrow accounts, and procured overpriced and often unneeded force-placed insurance policies for homeowners. The AG’s Office reached a $2 million settlement with Ocwen in March 2019.

Under the terms of the settlement, Altisource will pay $550,000, which will be used in part to reimburse homeowners who were charged excessive premiums for force-placed insurance. Altisource has also agreed to change its business practices to prevent unnecessary inspection and maintenance services. 

This matter was handled by Assistant Attorneys General Michael Lecaroz and Sarah Petrie and Deputy Division Chief Shennan Kavanagh, all of the AG’s Consumer Protection Division, with assistance from Division Chief Glenn Kaplan and Deputy Director Arwen Thoman of the AG’s Insurance and Financial Services Division.

###