CITY OF ST. CLAIR SHORES POLICE AND FIRE RETIREMENT SYSTEM vs NATIONSTAR MORTGAGE HOLDINGS INC., JESSE K. BRAY and ROBERT D. STILES | ROBO-SIGNING - COMPLAINT FOR VIOLATIONS OF THE FEDERAL SECURITIES LAWS

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA Case No. _______-Civ-___________ CITY OF ST. CLAIR SHORES POLICE AND FIRE RETIREMENT SYSTEM, Individually and on Behalf of All Others Similarly Situated, Plaintiff, vs. NATIONSTAR MORTGAGE HOLDINGS INC., JESSE K. BRAY and ROBERT D. STILES, Defendants.

CLASS ACTION DEMAND FOR JURY TRIAL

EXCERPT: In February 2012, 49 states and the District of Columbia entered into a $25 billion settlement with Ally Bank (formerly GMAC), Ba nk of America, Citicorp, JP Morgan Chase and Wells Fargo, five of the nation’s biggest mortgage lenders, over a laundry list of improprieties from “robo-signing” foreclosure documents to failing to negotiate in good faith with homeowners over inflated fees and other charges that pushed them in to default (the “National Mortgage Settlement”). The National Mortgage Settlement encouraged le nders to negotiate lower rates with existing borrowers and to lower principal am ounts owed in an effort to keep houses out of foreclosure. Pursuant to new servicing rule s under the National Mortgage Se ttlement designed to slow down foreclosures, the signing banks were prohibited from employing “robo- signing” in connection with foreclosures or paying agents to speed up forecl osures, took on new detailed paperwork obligations, and had to take a number of other steps before foreclosing, including reviewing any loan modification proposals the borrower made and givi ng borrowers two weeks to accept or reject any offer the bank made. Separately, banks also faced regulations under Basel III, a comprehensive set of reform measures, limiting the amount of capital they could risk on servicing rights, spurring them to offload their servicing businesses. 37. Following the financial crisis, Ocwen, then the nation’s largest non-bank mortgage servicing company, began buying up servicing right s from banks who were no longer willing to assume the substantial risks of servicing their own MSRs. 38. On December 19, 2013, the Consumer Financ ial Protection Bureau (the “CFPB”), joined by 49 states and the District of Columbia, filed a complaint in the U.S. District Court for the District of Columbia alleging that Ocwen and othe r firms had violated, among other laws, the Unfair and Deceptive Acts and Practices laws of the plai ntiff states and the Consumer Financial Protection Act of 2010 by deceiving consumers about their loans and engaging in illegal foreclosures. According to the complaint, investigators found evidence that, among other things, Ocwen gave borrowers false or misleading information, did not honor trial modifications begun by previous servicers, wrongly charged fees, and denied mortgage loan modifications to eligible borrowers. During a conference call held with reporters that day, CFPB direct or Richard Cordray stated that “‘[t]oo often, trouble began as soon as the loan was transferred to Ocwen,’” adding that “‘Ocwen made troubled borrowers even more vulnerable to foreclosure.’” 39. Ocwen, the CFPB, and the 49 states and Distri ct of Columbia entered into a Consent Judgment also filed in the U.S. District Court for the District of Columbia on December 19, 2013, under which Ocwen was forced to fund a $2.1 billion mortgage settlement for mortgage servicing abuses (including $2 billion in first-lien prin ciple reduction and $125 million for cash payments to borrowers whose loans had been fo reclosed on). According to th e CFPB, “‘Ocwen took advantage of borrowers at every stage of the process.’” The $2.1 billion fine far exceeded Ocwen’s $1.5 billion of revenue during the first nine months of 2013, and dwarfed the $357 million in cash Ocwen then had on its books. 40. Under the 2013 Consent Judgment, Ocwen was required to improve its oversight of its attorneys, bolster training for its employees , refrain from making collection calls when a borrower’s application for a modification was pending, and increase its staff. The 2013 Consent Judgment contained “Examination Findings” indicating that Ocwen suffered from: a. Lack of controls related to document execution , including evidence of robo- signing, unauthorized execution, assignment backdating, improper certification and notarization, chain of title irregularities, and other related practices affecting the in tegrity of documents relied upon in the foreclosure process; b. Deficiencies in loss mitigation and lo an modification processes, including but not limited to: 1. Failure to effectively communicate with borrowers regarding loss mitigation and other foreclosure avoidance alternatives; 2. Failure to account for documents submitted in tandem with application for loss mitigation assistance ; 3. Lack of reasonable expedience in approving or denying loss mitigation applications ; 4. Providing false or misleading reasons for denial of loan modifications ; and 5. Failure to honor the terms loan modifications for transferred accounts and continued efforts to collect payments under the original note terms. [...]