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Wells Fargo restructures credit card processing biz

As part of continuing efforts to crack down on aggressive sales tactics, Wells Fargo & Co. restructured its credit card processing business after finding out that some employees misreported customer sales and cajoled small businesses into entering into contracts they did not fully understand, The Wall Street Journal reported April 5.

The company dismissed at least 24 workers at Wells Fargo Merchant Services LLC. This is not the first time the company has let go of employees for the same offenses — the Journal noted that the last two years have seen employee dismissals over similar behavior at the company's credit card business.

Processes at the division have also been changed. For one, the company discontinued the practice of allowing referrals of small-business customers to merchant-services employees by retail branch bankers without manager approval. As a result, one former employee told the news outlet that referrals to merchant services have dropped by more than 50%. Different teams are also no longer competing with each other for small-business sales.

In addition, the company moved the merchant-processing division into a new payments unit, and a new head was named to oversee small business for merchant services. The Journal also reported that the company has reached out to a number of customers who have had issues with merchant services, with some being offered refunds or financial assistance.