The United States Consumer Financial Protection Bureau filed a complaint against Walmart and Branch Messenger, accusing them of requiring delivery drivers to use poorly managed and expensive deposit accounts to receive payment.
The complaint highlights concerns about the financial products’ management and the cost burden on drivers.
“Walmart made false promises, illegally opened accounts, and took advantage of more than a million delivery drivers,” CFPB Director Rohit Chopra said in a press release on Monday. “Companies cannot force workers into getting paid through accounts that drain their earnings with junk fees.”
The lawsuit claims that since 2021, Walmart and Branch opened Branch accounts for over a million drivers in the Spark Driver Program without their consent, depositing drivers’ pay into these accounts.
This action allegedly forced drivers to use these accounts for payments, which were reportedly poorly managed and costly.
The lawsuit further alleges that Walmart and Branch coerced drivers into using the Branch accounts by threatening termination if they refused. Additionally, drivers were reportedly misled about when they could access their earnings, leading to delays and fees if they tried to transfer funds to other accounts. These practices are said to have resulted in over $10 million in “junk fees” for drivers.
The CFPB also accused Branch of failing to investigate errors, provide required disclosures, maintain records, and honor stop payment requests.
Additionally, Branch allegedly forced consumers to waive their legal rights.
This lawsuit is part of the CFPB’s broader crackdown on companies mishandling consumer and worker financial accounts, following a previous case against Comerica Bank for illegal fees on federal benefits and prepaid debit cards.
The CFPB’s most recent complaint targets the operator of the Zelle payments network, along with JPMorgan Chase, Bank of America, and Wells Fargo.
The lawsuit alleges that these firms failed to properly investigate fraud complaints or reimburse victims. Since Zelle’s launch in 2017, customers are said to have lost over $870 million due to these issues.
