Consumer Financial Protection Bureau Files Lawsuit Against Walmart and Branch Messenger Over Alleged Misuse of Delivery Driver Pay
The Consumer Financial Protection Bureau (CFPB) has filed a complaint against Walmart and work-scheduling platform Branch Messenger, alleging that they forced delivery drivers to use poorly managed and costly deposit accounts to receive their pay.
The complaint, filed on Monday, alleges that Walmart and Branch opened over one million Branch accounts for drivers in the Spark Driver Program, Walmart’s platform for gig economy workers, and deposited their pay into these accounts without their consent. The company allegedly told drivers that they would be fired if they did not want to use the Branch accounts and misled them about when they could access their earnings.
According to the CFPB, drivers who used the platform faced numerous delays or fees when trying to transfer their money to a different account, resulting in more than $10 million in “junk fees.”
Walmart and Branch have disputed the CFPB’s allegations, with Walmart claiming that the agency’s lawsuit is “riddled with factual errors” and “contains exaggerations and blatant misstatements of settled principles of law.” Branch also disagreed with the lawsuit, saying it “misstates the law and facts, and includes intentional omissions to mask the Bureau’s clear overreach.”
The CFPB’s lawsuit is the latest in a series of actions it has taken against companies for mishandling consumer and worker financial accounts. The agency has previously sued several companies, including Comerica Bank and the operator of the Zelle payments network, JPMorgan Chase, Bank of America, and Wells Fargo, over allegations of illegal fees and inadequate fraud protection.