Financial Watchdog Takes Aim at Walmart and Branch Messenger Over Alleged Exploitation of Delivery Drivers
The Consumer Financial Protection Bureau (CFPB) has filed a complaint against retail giant Walmart and work-scheduling platform Branch Messenger, accusing them of forcing delivery drivers to use poorly managed and costly deposit accounts to receive their pay.
A Pattern of Deception
According to the CFPB, Walmart and Branch allegedly opened Branch accounts for over one million drivers without their consent, depositing their pay into these accounts and misleading them about when they could access their earnings. Drivers who refused to use the Branch accounts were allegedly threatened with termination. The CFPB claims that this scheme resulted in more than $10 million in “junk fees” for drivers.
Walmart and Branch Push Back
Walmart has disputed the allegations, calling the CFPB’s lawsuit “riddled with factual errors” and claiming that the agency did not give them a fair opportunity to present their case during the investigation. Branch has also denied the allegations, stating that the lawsuit “misstates the law and facts” and includes intentional omissions to mask the CFPB’s overreach.
A History of Mishandling Financial Accounts
This lawsuit is the latest in a series of actions taken by the CFPB against companies for mishandling consumer and worker financial accounts. The bureau has previously sued Comerica Bank over allegations of failing to administer a federal benefits program and charging illegal fees on prepaid debit cards. Most recently, the CFPB filed a complaint against the operator of the Zelle payments network, as well as several major banks, alleging that they failed to properly investigate fraud complaints or give victims reimbursement.
Protecting Workers’ Rights
The CFPB’s lawsuit against Walmart and Branch serves as a reminder that companies cannot take advantage of workers by forcing them into costly and poorly managed financial accounts. As CFPB Director Rohit Chopra stated, “Companies cannot force workers into getting paid through accounts that drain their earnings with junk fees.” The agency’s actions aim to protect workers’ rights and ensure that they are treated fairly by companies.
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