Amid Republican efforts to insulate banks from lawsuits, Democrats are hoping to grill Wells Fargo executives about recent developments in the bank’s fake accounts scandal.
Every Democrat on the Senate Banking Committee sent a letter on Tuesday to Mike Crapo (R-Idaho), the panel’s chair, asking for a hearing featuring Wells CEO Timothy Sloan and the chair of the bank’s board of directors, Stephen Sanger.
The move comes just days after Wells “admitted that it signed up hundreds of thousands of its auto loan customers for insurance without their consent,” as the senators noted. The New York Times reported last week that the practice led to 274,000 delinquencies and “resulted in almost 25,000 wrongful vehicle repossessions” from 2012-2016.
Senate Democrats’ entreaty also comes days after the House passed legislation that would stop the implementation of a Consumer Financial Protection Bureau rule fighting banks’ efforts to get out of being sued, through the use of fine print in contracts.
The CFPB regulation would prevent banks and credit card companies from including so-called “forced arbitration clauses” in customer agreements. The strategy is used to force consumers into private dispute settlement and to undermine class action lawsuits.
Crapo has introduced an identical bill in the Senate that has thirty cosponsors — all Republicans. Democrats bemoaned this push in their letter, pointing out that Wells used forced arbitration clauses to keep the lid on its fake accounts scandal.
Last September, Wells Fargo was fined $185 million by a number of regulators, including the CFPB, for opening up to 2.1 million accounts without customers’ authorization. The bank admitted to the wrongdoing from 2011-2015, amid corporate…