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The company first revealed its capital plan in January. The plan is expected to reduce Genworth Mortgage Insurance Company's (GMICO) risk-to-capital ratio by about 15 points and lower the combined risk-tocapital ratio of the U.S. mortgage insurance subsidiaries by about 10 points. The plan should also decrease the likelihood mortgage insurance subsidiaries would need additional capital, ensure the ability to write new business, and decrease the risk of a default for Genworth's senior notes. One action that is part of the plan involved transferring ownership of the European mortgage insurance subsidiaries to GMICO. Under the new plan, should adverse conditions occur, Genworth has the future option of implementing a "New Co" structure to continue writing new business in all 50 states. Genworth also injected $100 million into GMICO on April 1 as part of the plan. "We are very pleased to have received all the necessary regulatory approvals and fully implement the comprehensive capital plan for the U.S. mortgage insurance business announced in January 2013," said Martin P. Klein, EVP and chief financial officer. "U.S. mortgage insurance is a key component of our global mortgage insurance division, and the plan increases our financial flexibility while bolstering capital in the business to continue writing profitable new business and returning the business to profitability over time." VirPack, IDS Collaborate to Streamline Initial Disclosures VirPack, a provider of document management and eDelivery solutions based in Vienna, Virginia, and IDS Inc., a Salt Lake City-based provider of mortgage documents and compliance, are teaming up to streamline initial disclosures. The expanded relationship involves eDisclosure integration with IDS' flagship document prep solution idsDoc. The new integration offers several benefits, including the automation of the document indexing process and the secure transmission of the package to VirPack's document management platform, Enterprise Center. "The expansion of our relationship with IDS from closing docs to now include eDisclosures provides lenders even greater efficiencies," said Wayland T. Pond IV, 108 VirPack's VP of sales and marketing. "The eSigned initial disclosure package will be securely and automatically imported into the designated loan in Enterprise Center, automating the indexing process and ensuring compliance." The collaboration ensures compliance by offering eSign and eConsent to the borrower, tracking the date and receipt, eliminating manual processes, and providing paper disclosures if the borrower opts out of eConsent. "When it comes to initial disclosures, 100 percent compliance is the first priority at IDS. It is essential to feel confident that disclosures are prepared and delivered in accordance with RESPA guidelines," said Mark Mackey, EVP at IDS. "Our aim is to make fully compliant initial disclosures simple and quick enough to allow lenders to spend more time originating more business, and this expanded relationship with VirPack allows just that." Inspector General: Complaints Not Handled Properly by Freddie Servicers A new report from a government watchdog accuses McLean, Virginia-based Freddie Mac, its servicers, and the Federal Housing Finance Agency (FHFA) of not meeting requirements when handling and resolving escalated consumer complaints. According to a report from the FHFA Office of Inspector General (OIG), Freddie Mac and eight of its largest servicers, which service 70 percent of the GSE's mortgages, received more than 34,000 complaints that became escalated cases during a 14-month time period ending November 30, 2012. Escalated cases include foreclosure actions in violation of the GSEs' guidelines; allegations of fraudulent servicing practices; complaints that the borrower did not receive proper evaluation or was inappropriately denied a foreclosure alternative; threats of litigation; and violations of the GSEs' policy timeframes for borrower outreach, evaluation, or time permitted for a response, according to the inspector general's report. After tracking the escalated cases, FHFA-OIG found a failure to implement the Servicing Alignment Initiative (SAI) and Servicing Guide requirements for escalated consumer complaints among Freddie Mac servicers. For example, seven out of the eight Freddie Mac servicers did not resolve all escalated cases within the 30-day mandate, and some servicers did not correctly categorize the nature of escalated cases. Four servicers—Bank of America, CitiMortgage, Provident, and Wells Fargo—failed to report any escalated cases to Freddie Mac during the 14-month time period even though they handled more than 20,000 cases. When the servicers were contacted, they "indicated that they would begin reporting to Freddie Mac," the FHFA-OIG report stated. Furthermore, Freddie Mac data showed that 98 percent of its servicers, or 1,179 out of 1,207, did not report any escalated cases as of December 2012. "This strongly suggests that many other servicers handled escalated cases but did not comply with the reporting requirements," the report stated. Of the four large servicers that did not report escalated cases, one servicer said it was not aware of the requirement and another said the GSE had not requested the information during an onsite examination. Among the eight largest servicers, 26,196 escalated cases were handled during the 14-month time period, of which 25,528 were resolved. About 21 percent of those cases, or 5,371, exceeded the 30-day time frame. Branch Banking & Trust Corporation (BB&T), however, managed to resolve all of its escalated cases within 30 days. FHFA-OIG also found issues with how escalated cases were categorized when resolved. When categorizing escalated cases, servicers are required to use 13 resolution categories. However, one servicer used 61 different categories when identifying resolutions. Overall, about 8 percent of the 25,528 resolved cases lacked a required resolution category. The report also determined the GSE did not implement procedures for testing servicer compliance and has not established penalties, such as fines, for servicers who fail to report escalated cases, according to the report. When examining Freddie Mac's implementation of the SAI, FHFA failed to identify noncompliance with consumer complaint requirements, according to the inspector general. The FHFA examination team also did not conduct its own testing of servicer compliance but instead relied solely on the GSE's reports of on-site operational audits, which made no mention of any problems with servicer reporting.

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