By Lisa Lambert
WASHINGTON (Reuters) - A group of U.S. senators from both parties on Wednesday turned up the heat on Wells Fargo Inc. <WFC.N> over its latest scandal, in which hundreds of thousands of car-loan borrowers were charged each month without their knowledge for collision insurance, which many of them did not need.
The Republican chairs of the committee and the subcommittee that would head any congressional investigations into insurance sales, Senators John Thune and Jerry Moran, along with those panels' senior Democrats, Senators Bill Nelson and Richard Blumenthal, wrote to Wells CEO Timothy Sloan with questions about the scandal as basic as how many customers were affected.
They also requested copies of the bank's internal report that first identified the problem.
The group sent similar questions to Barry Karfunkel, CEO of National General Holdings Corporation, which provided the insurance.
Last week Moran said he was seeking additional information from Wells about reports the bank charged 800,000 borrowers for insurance without their knowledge or consent, but did not give specifics. Many borrowers already had cheaper insurance with other companies.
The letter asks Sloan when the bank, which paid $190 million in fines and penalties last year over creating phantom bank accounts, first learned about the insurance sales practices and also what steps it is taking to prevent a recurrence and to refund the erroneous charges to customers.
The letters do not mention possible hearings or subpoenas, but the senators have the authority launch an investigation using both if they are not satisfied with responses to their letters. Wells and National have until Aug. 23 to answer the questions.
The Wells letter shows senators are concerned with reports that thousands of borrowers fell into delinquency because they could not afford the premiums on top of their monthly payments and the possibility bank management pushed employees to sign customers up for insurance with incentives or special benefits.
Incentives are at the heart of last year's scandal, where employees said they created accounts in customers' names or pushed account holders to buy additional products they did not need in order to meet high sales targets.
The senators are also seeking information about possible commissions paid or revenues shared between Wells and National.
Wells spokeswoman Jennifer Dunn said the bank is committed to addressing the lawmakers' concerns.
"Customer harm is not acceptable at Wells Fargo," she said. "We are committed to fixing these mistakes and earning back trust.”
(Reporting by Lisa Lambert; Editing by David Gregorio)