The Consumer Financial Protection Bureau is suing Walmart and a financial technology company for illegally forcing drivers to use expensive savings accounts to receive their wages.
The agency alleges that Walmart and its retailer, Branch Messenger, forced the drivers, who were part of Walmart’s Spark Driver gig work platform, to use Branch Messenger’s deposit accounts to collect their compensation — and that they would be terminated if they did not want to use it. this service.
The CFPB also alleges that Walmart and Branch Messenger misled employees about the availability of same-day access to their earnings, and that drivers had to follow a complex process to access their funds.
Even if they did have access to their money, the CFPB alleges, drivers faced delays or fees when they had to transfer the money to an account of their choice — resulting in workers losing more than $10 million in payments since 2021 paid fees to transfer their income.
“Walmart made false promises, illegally opened accounts and took advantage of more than a million delivery drivers,” said CFPB Director Rohit Chopra. “Companies cannot force their employees to get paid through bills that take away their revenue with junk fees.”
Walmart said in a statement that the CFPB’s lawsuit was “rife with factual errors” and “exaggerations and glaring misstatements of settled principles of law.”
“The CFPB never gave Walmart a fair opportunity to present its case during their rushed investigation,” the report said. “We look forward to vigorously defending the company before a court that, unlike the CFPB, respects due process.”
In a statement, Branch Messenger said the CFPB’s lawsuit “misrepresents the law and the facts” while omitting issues intended to “mask the Bureau’s clear overreach.”
“Despite the company’s extensive cooperation with the investigation, the CFPB declined to engage with Branch in any meaningful way in this matter, instead rushing to file a lawsuit,” Branch said. “This approach makes it clear that this lawsuit has nothing to do with the law or worker protections and everything to do with the media attention garnered by a lawsuit involving one of the world’s largest retailers.”
The CFPB announced a slew of rules and lawsuits this month as the Biden administration comes to an end and uncertainty clouds the agency’s future. Last week, the CFPB sued three of America’s largest banks, alleging they failed to curb fraud on digital payments platform Zelle. The banks and the operator of Zelle, which was also named in the lawsuit, have denied the allegations.
