The Consumer Financial Protection Bureau (CFPB) has filed a lawsuit against Walmart and fintech company Branch Messenger, alleging that the companies forced over 1 million delivery workers to use expensive deposit accounts to access their paychecks. The CFPB claims that Walmart’s drivers were required to use these accounts, which charged high fees for transferring wages into other bank accounts.
According to the complaint, Walmart’s Spark Drivers – independent contractors who deliver packages to customers’ doorsteps – were only allowed to have their pay deposited into Branch accounts. Workers were warned that they could lose their jobs if they didn’t comply. The lawsuit alleges that this process was complex and often resulted in weeks-long delays, despite assurances of instant access.
The CFPB is accusing Walmart and Branch of draining workers’ earnings with “junk fees” worth $10 million. The agency’s director, Rohit Chopra, stated that companies cannot force workers into accounts that drain their earnings with junk fees.
Walmart has denied the claims, stating that the lawsuit contains factual errors and exaggerations. Branch also denies the allegations, saying it provides “quick and easy access to funds.”
Source: https://edition.cnn.com/2024/12/23/business/walmart-branch-cfpb-lawsuit/index.html