ACI Worldwide and one of its subsidiaries, ACI PaymentAgreed to pay a $25 million civil penalty for illegally processing $2.3 billion in unauthorized mortgage payments from approximately 500,000 homeowners. mr cooper two years ago.
consumer financial protection bureau (CFPB) issued a consent order against the company on Tuesday for improperly initiating transactions in April 2021 that caused homeowners to pay overdraft and insufficient funds fees from their financial institutions.
In response, the ACI said it has agreed to the order “without admitting any wrongdoing to avoid the expense and distraction of litigation”.
Meanwhile, Mr Cooper said it is “in line with the agency’s approach to identifying the mishandling of critical information of our customers by our former vendor and taking appropriate action as a preventive measure against similar incidents in the future”. conforms.”
The case began in 2021 when the CFPB said it was investigating a situation involving Cooper making unauthorized withdrawals from borrower accounts during the weekend. Mr. Cooper quickly pointed the finger at its seller, ACI Worldwide.
“The CFPB’s investigation found that ACI orchestrated the 2021 Mr. Cooper mortgage failure, which affected homeowners across the country,” CFPB Director Rohit Chopra said in a statement. “Though the borrower accounts have now been rectified, we are punishing ACI for its illegal actions which have caused headache to lakhs of borrowers.”
According to the CFPB, ACI tested its platform in April 2021, but instead of using anonymous or dummy data, it used real consumer data, such as names and bank account details, of Mr. Cooper’s customers. In total, ACI initiated approximately 1.4 million ACH withdrawals.
On Saturday, April 24, 2021, homeowners noticed inaccuracies in their account balances. For example, about 7,300 borrowers’ available balances were reduced by more than $10,000 overnight, the CFPB said.
In a statement, ACI said the consent order pertains to the “first disclosure” of inadvertent transmission of ACH files on its network during testing of the recently acquired Speedpay bill payment platform in April 2021.
“An internal review revealed that ACI’s policies and procedures were not followed. ACI took swift action to reverse the ACH entries and prevent any consumer loss. At all times during and after the error, consumers’ money and personal information remained secure,” the company wrote in a statement.
ACI also settled a consumer class action resulting from the error in May. The company expects that most of the costs in both the consent order and the lawsuit will be covered by third parties.
