TAMPA, Fla., Sept. 4, 2015 /PRNewswire/ -- Walter Investment
Management Corp. (NYSE: WAC, "Walter Investment" or the "Company"),
issued the following statement today regarding its final settlement
with the U.S. Department of Housing and Urban Development ("HUD")
and the U.S. Department of Justice ("DOJ") which fully resolves all
claims alleged in a previously disclosed lawsuit filed in federal
court in Florida against the
Company and certain of its subsidiaries relating to its reverse
mortgage business, including Reverse Mortgage Solutions, Inc.
("RMS") which was acquired in November of 2012.
The Company had previously disclosed that it had reached a
tentative settlement agreement with HUD and the DOJ regarding the
claims. The final settlement does not contain any admission
or finding of wrongdoing by Walter Investment or its subsidiaries,
and the government has released the Company and its subsidiaries
from potential liability relating to the conduct alleged in the
complaint under various federal laws including the False Claims
Act. As of June 30, 2015, the Company
had accrued substantially all of the $29.63
million settlement payment related to the claims, and all
such amounts will be paid from available cash.
"We believe this resolution is in the best interest of the
Company and our shareholders and are pleased to have resolved these
claims," said Mark J. O'Brien,
Chairman and Chief Executive Officer of Walter Investment.
"As a leading franchise in the reverse mortgage sector, RMS is
fully committed to, and strongly supportive of, the HECM program
and the benefits it provides to its customers."
About Walter Investment Management Corp.
Walter
Investment Management Corp. is a diversified mortgage banking firm
focused primarily on the servicing and origination of residential
loans, including reverse loans. Based in Tampa, Fla., the Company has approximately
6,000 employees and services a diverse loan portfolio. For more
information about Walter Investment Management Corp., please visit
the Company's website at www.walterinvestment.com.
Disclaimer and Cautionary Note Regarding Forward-Looking
Statements
This press release contains
"forward-looking statements" within the meaning of Section 27A of
the Securities Act of 1933, as amended and Section 21E of the
Securities Exchange Act of 1934, as amended. Statements that are
not historical fact are forward-looking statements. Certain of
these forward-looking statements can be identified by the use of
words such as "believes," "anticipates," "expects," "intends,"
"plans," "projects," "estimates," "assumes," "may," "should,"
"will," or other similar expressions. Such forward-looking
statements involve known and unknown risks, uncertainties and other
important factors, and our actual results, performance or
achievements could differ materially from future results,
performance or achievements expressed in these forward-looking
statements. These forward-looking statements are based on our
current beliefs, intentions and expectations. These statements are
not guarantees or indicative of future performance. Important
assumptions and other important factors that could cause actual
results to differ materially from those forward-looking statements
include, but are not limited to, those factors, risks and
uncertainties described below and in more detail in our Annual
Report on Form 10-K for the year ended December 31, 2014, our Quarterly Reports on Form
10-Q for the quarterly periods ended March
30, 2015 and June 30, 2015 and
in our other filings with the SEC.
In particular (but not by way of limitation), the following
important factors, risks and uncertainties could affect our future
results, performance and achievements and could cause actual
results, performance and achievements to differ materially from
those expressed in the forward-looking statements:
- our ability to operate our business in compliance with existing
and future rules and regulations affecting our business, including
those relating to the origination and servicing of residential
loans, the management of third-party assets and the insurance
industry (including lender-placed insurance), and changes to,
and/or more stringent enforcement of, such rules and
regulations;
- increased scrutiny and potential enforcement actions by federal
and state authorities;
- the substantial resources (including senior management time and
attention) we devote to, and the significant compliance costs we
incur in connection with, regulatory and contractual compliance and
regulatory examinations and inquiries, and any consumer redress,
fines, penalties or similar payments we make in connection with
resolving such matters;
- uncertainties relating to interest curtailment obligations and
any related financial and litigation exposure (including exposure
relating to false claims);
- potential costs and uncertainties associated with and arising
from litigation, regulatory investigations and other legal
proceedings;
- our dependence on U.S. government-sponsored entities
(especially Fannie Mae) and agencies and their residential loan
programs and our ability to maintain relationships with, and remain
qualified to participate in programs sponsored by, such entities,
our ability to satisfy various existing or future GSE, agency and
other capital, net worth, liquidity and other financial
requirements applicable to our business, and our ability to remain
qualified as a GSE approved seller, servicer or component servicer,
including the ability to continue to comply with the GSEs'
respective residential loan and selling and servicing guides;
- uncertainties relating to the status and future role of GSEs,
and the effects of any changes to the origination and/or servicing
requirements of the GSEs or various regulatory authorities or the
servicing compensation structure for mortgage servicers pursuant to
programs of GSEs or various regulatory authorities;
- our ability to maintain our loan servicing, loan origination,
insurance agency or collection agency licenses, or any other
licenses necessary to operate our businesses, or changes to, or our
ability to comply with, our licensing requirements;
- our ability to comply with the servicing standards required by
the National Mortgage Settlement;
- our ability to comply with the terms of the stipulated order
resolving allegations arising from an FTC and CFPB investigation of
Green Tree Servicing, LLC;
- operational risks inherent in the mortgage servicing and
mortgage originations businesses, including reputational risk;
- risks related to our substantial levels of indebtedness,
including our ability to comply with covenants contained in our
debt agreements, generate sufficient cash to service such
indebtedness and refinance such indebtedness on favorable terms, as
well as our ability to incur substantially more debt;
- our ability to renew advance financing facilities or warehouse
facilities and maintain borrowing capacity under such
facilities;
- our ability to maintain or grow our servicing business and our
residential loan originations business;
- our ability to achieve our strategic initiatives;
- changes in prepayment rates and delinquency rates on the loans
we service or sub-service;
- the ability of our clients and credit owners to transfer or
otherwise terminate our servicing or sub-servicing rights;
- a downgrade in our servicer ratings or credit ratings;
- our ability to collect reimbursements for servicing advances
and earn and timely receive incentive and performance payments and
ancillary fees on our servicing portfolio;
- our ability to collect indemnification payments and enforce
repurchase obligations relating to mortgage loans we purchase from
our correspondent clients and our ability to collect
indemnification payments relating to servicing rights we purchase
from prior servicers;
- local, regional, national and global economic trends and
developments in general, and local, regional and national real
estate and residential mortgage market trends in particular,
including the volume and pricing of home sales, the credit quality
of loan origination customers and uncertainty regarding the levels
of mortgage originations and prepayments;
- uncertainty as to the volume of originations activity we will
benefit from prior to, and following, the expiration of HARP, which
is scheduled to occur on December 31,
2016;
- risks associated with the origination, securitization and
servicing of reverse mortgages, including changes to reverse
mortgage programs operated by FHA, HUD or Ginnie Mae, our ability to accurately estimate
interest curtailment liabilities, continued demand for HECM loans
and other reverse mortgages, our ability to fund HECM repurchase
obligations, our ability to fund principal additions on our HECM
loans, and our ability to securitize our HECM loans and tails;
- our ability to implement strategic initiatives, particularly as
they relate to our ability to raise capital, make arrangements with
potential capital partners and develop new business, including
acquisitions of mortgage servicing rights and the development of
our originations business, all of which are subject to customer
demand and various third-party approvals;
- our ability to realize all anticipated benefits of past,
pending or potential future acquisitions or joint venture
investments;
- the effects of competition on our existing and potential future
business, including the impact of competitors with greater
financial resources and broader scopes of operation;
- changes in interest rates and the effectiveness of any hedge we
may employ against such changes;
- risks and potential costs associated with technology and
cybersecurity, including the risks of technology failures and of
cyber-attacks against us or our vendors, our ability to adequately
respond to actual or alleged cyber-attacks and our ability to
implement adequate internal security measures and protect
confidential borrower information;
- our ability to comply with evolving and complex accounting
rules, many of which involve significant judgment and
assumptions;
- uncertainties regarding impairment charges relating to our
goodwill or other intangible assets;
- our ability to maintain effective internal controls over
financial reporting and disclosure controls and procedures;
- our ability to manage conflicts of interest relating to our
investment in WCO; and
- risks related to our relationship with Walter Energy and
uncertainties arising from or relating to its bankruptcy filings,
including potential liability for any taxes, interest and/or
penalties owed by the Walter Energy consolidated group for the full
or partial tax years during which certain of the Company's former
subsidiaries were a part of such consolidated group and certain
other tax risks allocated to us in connection with our spin-off
from Walter Energy.
All of the above factors, risks and uncertainties are difficult
to predict, contain uncertainties that may materially affect actual
results and may be beyond our control. New factors, risks and
uncertainties emerge from time to time, and it is not possible for
our management to predict all such factors, risks and
uncertainties.
Although we believe that the assumptions underlying the
forward-looking statements (including those relating to our
outlook) contained herein are reasonable, any of the assumptions
could be inaccurate, and therefore any of these statements included
herein may prove to be inaccurate. In light of the significant
uncertainties inherent in the forward-looking statements included
herein, the inclusion of such information should not be regarded as
a representation by us or any other person that the results or
conditions described in such statements or our objectives and plans
will be achieved. We make no commitment to revise or update any
forward-looking statements in order to reflect events or
circumstances after the date any such statement is made, except as
otherwise required under the federal securities laws. If we were in
any particular instance to update or correct a forward-looking
statement, investors and others should not conclude that we would
make additional updates or corrections thereafter except as
otherwise required under the federal securities laws.
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SOURCE Walter Investment Management Corp.