A major student-loan company is 'impeding' borrowers' debt cancellation and 'mishandling' their monthly bills, Elizabeth Warren says. She wants its CEO to face Congress.

• Sen. Elizabeth Warren called on the CEO of student-loan company MOHELA to testify before the Senate in April.
• The hearing is set to examine MOHELA's handling of the return to repayment and PSLF.

Massachusetts Sen. Elizabeth Warren has questions for the head of a major student-loan company — and she wants him to answer them in Congress next month.

On Monday, Warren sent a letter to Scott Giles, the CEO of federal student-loan servicer MOHELA, inviting him to testify before the Senate banking committee on April 10. The hearing, called "MOHELA's Performance as a Student Loan Servicer," is intended to examine how MOHELA has performed since the return to repayment in the fall, along with its handling of the Public Service Loan Forgiveness Program.

MOHELA was the first federal servicer to be punished by the Education Department for failing to fulfill its contractual obligations. In October — the same month borrowers began to pay their bills after an over three-year pause — the department withheld over $7 million in pay from the company for failing to send on-time billing statements to borrowers.

Additionally, two student-loan borrowers sued MOHELA in December, accusing the company of delaying their PSLF applications and forcing them to make payments they did not owe.

"Your company has contributed to student loan borrowers' difficulties by mishandling borrowers' return to repayment following the COVID-19 pandemic-related pause on payments, interest, and collections and by impeding public servants' access to PSLF relief," Warren wrote in the letter.

"Your testimony will provide you with an opportunity to offer context on MOHELA's role as a student loan servicer at a time of significant transition for the federal student loan program," she added.

MOHELA did not immediately respond to a request for comment from Business Insider.

Warren, along with other Democratic lawmakers, has previously scrutinized MOHELA's handling of student-loan borrowers' accounts. Most recently, Warren joined Senate Majority Leader Chuck Schumer and Sen. Bernie Sanders in calling on the Consumer Financial Protection Bureau and state attorneys general to "investigate MOHELA and pursue action to the fullest extent possible under the law. Our nation's public servants, members of the military, and first responders deserve far, far better."

Still, other federal servicers have not escaped scrutiny. In January, the Education Department withheld a combined $2 million in pay from Nelnet, Aidvantage, and EdFinancial for failing to send on-time billing statements to borrowers.

Despite the administration's efforts, many borrowers are confused with the status of their accounts — specifically when it comes to PSLF. BI previously spoke to a few borrowers who received loan forgiveness through PSLF last year, only to be told by MOHELA in February that it was a mistake and they have to restart their payments again.

"I'm very upset. I'm not going to be able to buy a new car," one of the borrowers said. "My whole world has been flipped over in a matter of a week."