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A fraud on the public or simply faulty checks and balances?

As one of the country's largest banks, Wells Fargo understandably comes in for a lot of scrutiny from regulators and consumers at all times.

Notwithstanding the glaring spotlight that is always on national banks, though, Wells Fargo officials know that their company commands special attention these days, especially in the wake of a relatively recent scandal that CNN Money notes "launched the bank into turmoil nearly a year ago."

Many of our readers in Houston and across Texas undoubtedly remember that bank imbroglio well, with it being centrally marked by perhaps as many as two million charge-bearing accounts that the bank set up for customers without the knowledge or permission of those individuals.

And now, on the virtual heels of that corporate mess, media accounts are pointing to yet another scandal that is presently challenging the bank.

This one involves auto coverage, bringing a novel twist to notions surrounding insurance fraud.

What Wells Fargo is now reeling from are accusations that it may have adversely affected as many as 800,000 bank customers by charging them for insurance coverage they clearly did not need. The bank executes vehicle loans with high numbers of consumers and, pursuant to a key contractual clause, can unilaterally purchase insurance on their behalf when they lack an adequate amount of collision and comprehensive coverage.

Reportedly, hundreds of thousands of bank customers with perfectly good coverage were charged for even more by the bank. As a result, some could not keep up with vehicle payments and lost their cars. Others suffered unwarranted hits on their credit scores.

The bank is now atoning for that, and could be on the hook for $80 million or more in refund amounts that it will disburse to affected customers.

Although Wells Fargo officials concede a bank "failure," the company stops short of admitting that consumers were purposefully duped by fraudulent action. The unfortunate outcomes visited upon many bank account holders owed instead, say spokespersons, to "inadequate" checks and balances, as well as to systemic shortcomings inherent in systems operative in a company used by Wells Fargo to oversee insurance matters.

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