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Realignment Results in Servicer Cutting More Than 800 Jobs

Altisource layoffsLuxembourg-based mortgage servicer Altisource Portfolio Solutions is cutting more than 800 jobs both overseas and at home in the wake of what was a bumpy year for the company.

The move was announced in a conference call with investors on Friday that saw Altisource management working to reassure shareholders who have seen their stock drop more than 80 percent in the last year.

In the call, CFO Michelle Esterman said the layoffs reflect the company's need to realign its expenses as Ocwen Financial Corp.—Altisource's biggest customer since it spun off in 2009—faces roadblocks to its own growth.

Much of Altisource's struggle in 2014 can be traced to its close relationship with Ocwen, which was dealt blow after blow throughout the year by state and federal financial regulators, who cited concerns stemming from consumer complaints.

The hits continued earlier this month, when news broke that Ocwen may see its mortgage license suspended in California after it allegedly failed to comply with requests for loan documents from the state's Department of Business Oversight. (In the call with investors, Altisource CEO William Shepro said the chances of Ocwen losing its license are very low, though he wouldn't say more on the topic.)

A spokesperson for Altisource confirmed the layoffs, and media outlets in Boston and India have reported news of local offices cutting staff.

Altisource offered the following statement:

"We have been focused on diversifying our revenue sources and expanding our business to appeal to a broader customer set for several quarters, including the launch of new products and multiple strategic acquisitions that position us for the future. After a comprehensive process to evaluate the most effective way to pursue continued expansion in light of changing market conditions, we have made the difficult but necessary decision to realign our employee base with the growth opportunities in front of Altisource. We are optimistic about new market opportunities, and the difficult actions we are taking now will better position Altisource to execute against our growth strategy over the long-term."

About Author: Tory Barringer

Tory Barringer began his journalism career in early 2011, working as a writer for the University of Texas at Arlington's student newspaper before joining the DS News team in 2012. In addition to contributing to DSNews.com, he is also the online editor for DS News' sister publication, MReport, which focuses on mortgage banking news.
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