The Consumer Financial Protection Bureau filed a grievance against it on Monday Walmart and labor scheduling platform Branch Messenger for allegedly forcing delivery drivers to make use of poorly managed and dear deposit accounts to receives a commission.
“Walmart made false promises, illegally opened accounts and exploited more than a million delivery drivers,” CFPB Director Rohit Chopra said in a press release. “Companies cannot force workers to be paid through accounts that add junk fees to their income.”
The lawsuit alleges that since 2021, Walmart and Branch have opened store accounts for a couple of million drivers under the Spark Driver Program, Walmart's platform for gig economy employees to simply accept and schedule “last mile” deliveries, after which deposited the drivers' salaries into these accounts without their consent.
The company allegedly told drivers that they might be fired in the event that they didn’t wish to use the branch accounts and misled drivers about after they would give you the option to access their earnings. When drivers used the platform, they allegedly faced quite a few delays or fees after they needed to transfer the cash to a different account, leading to greater than $10 million in “junk fees.”
Walmart denied the agency's allegations.
“The CFPB's hasty lawsuit is riddled with factual errors and contains exaggerations and blatant misrepresentations of established legal principles,” a Walmart spokesperson wrote in a press release to CNBC. “The CFPB never gave Walmart a fair opportunity to state its case during its rushed investigation.”
The CFPB also accused Branch of failing to analyze alleged errors, failing to supply certain disclosures, failing to maintain records, failing to comply with payment requests, and unlawfully requiring consumers to waive their legal rights.
“Branch strongly disagrees with the lawsuit filed today by the CFPB as it misrepresents the law and facts and contains intentional omissions designed to obscure the FBI's clear overreach,” a representative for Branch wrote in a press release to CNBC.
The lawsuit is the newest in a series of actions the CFPB has taken against firms for misusing consumer and worker financial accounts. The bureau previously sued Comerica Bank over allegations that it did not administer a federal advantages program and charged illegal fees on prepaid debit cards.
Most recently, the CFPB filed a grievance against payment network operator Zelle in addition to JPMorgan Chase, Bank of America and Wells Fargo, alleging the businesses did not properly investigate fraud complaints or provide compensation to victims. The lawsuit claims customers have lost greater than $870 million since Zelle launched in 2017.
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