The Consumer Financial Protection Bureau (CFPB) has filed a lawsuit against Walmart (WMT) and workforce payments provider Branch Messenger, accusing them of imposing unlawful “junk fees” on over one million delivery drivers. According to the CFPB, the companies forced drivers enrolled in Walmart’s Spark Driver program to use Branch Messenger accounts, which allegedly drained their earnings through hidden fees totaling more than $10 million.
The lawsuit claims that Walmart instructed drivers they would be terminated unless they accepted payment through Branch accounts that were opened without their consent. The CFPB contends that this practice not only misled drivers but also subjected them to unexpected delays and excessive charges when attempting to access or transfer their wages.
CFPB Director Rohit Chopra stated, “Companies cannot force workers into financial arrangements that drain their hard-earned money with excessive and unnecessary fees.”
In response, both Walmart and Branch Messenger rejected the allegations. Walmart stated that the CFPB had rushed to file the lawsuit without offering the company adequate time to address the claims. A spokesperson for Walmart said, “We look forward to vigorously defending our position in a court of law that respects due process, unlike the CFPB.”
The CFPB’s lawsuit seeks to halt the alleged unfair practices, return misappropriated funds to affected drivers, and impose penalties that will be directed to the agency’s victim relief fund. This legal action comes on the heels of other recent regulatory efforts by the CFPB, including a high-profile lawsuit against major banks over their handling of the Zelle payment platform.
The case against Walmart and Branch highlights the growing scrutiny on gig economy practices, as regulators intensify their oversight to ensure fair treatment of workers in the rapidly expanding digital economy.
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