WASHINGTON – One of the largest mortgage servicers in the country was issued a consent order on Tuesday by the Office of the Comptroller of the Currency referring to insufficient risk management controls commensurate with the size of the bank.
Cenlar FSB, a New Jersey-based national bank with $ 1.1 billion in assets and just over 3,000 employees, is the country's largest mortgage loan sub-servicer; Cenlar is also the second largest service provider in the country.
Cenlar's "internal controls and risk management practices do not support the current risk profile and size of the bank's mortgage subservicing portfolio," the OCC said in its order.
In a statement, Cenlar said it had voluntarily taken the consent order that did not require the bank to admit or deny wrongdoing. There was also no fine.
"We take our regulatory obligations seriously and are working with the OCC to make any changes necessary to address their concerns," said Cenlar in a statement attributed to his board of directors. "We will continue to serve our customers and their customers with our ongoing commitment to care and excellence as we improve our risk management and control processes."
As part of the consent order, the bank is required to take "comprehensive corrective actions," including implementing new internal controls that are "commensurate with the bank's risk profile and the scope of its mortgage servicing business," according to an OCC press release.
The OCC reported that it had previously warned Cenlar of “flaws” in its risk management program.
Cenlar will also be required to "receive no regulatory objections" from the OCC before adding new clients to its mortgage subservicing business, as well as before distributing dividends to shareholders until the order is lifted at the agency's discretion, said the OCC.