The Consumer Financial Protection Bureau alleges in a lawsuit that more than a million delivery drivers collectively owed more than $10 million in fees after Walmart and Branch Messenger illegally opened expensive deposit accounts in their names without consent. Did. trial The filing was filed on Monday against the retailer and the payments platform.
The federal agency claims drivers were forced to use accounts to get paid and were deceived about how to access their earnings, prompting Walmart to fire employees who did not comply. Had threatened. Drivers had to follow a complex process to receive their pay, and then faced further delays or fees if they needed to transfer the money to another account.
The CFPB claims that as a result, workers took more than $10 million in fees to transfer their earnings to the accounts of their choice.
“Walmart made false promises, illegally opened accounts, and took advantage of more than one million delivery drivers,” CFPB Director Rohit Chopra said in a news release. release“Companies can't force workers to get paid through accounts that drain their earnings with junk fees.”
Both Walmart and Branch vowed a vigorous defense.
“The CFPB's hastily filed lawsuit is riddled with factual errors and includes exaggerations and blatant misrepresentations of established principles of law,” the retailing giant said in a statement emailed to CBS. Walmart was never given a fair opportunity to present its case.” Moneywatch.
Branch reiterated Walmart's stance, accusing the CFPB of misrepresenting “the law and the facts.” The CFPB's lawsuit “involves deliberate omissions” over what the company called the bureau's “overreach,” it said in an email.
It added, “The branch has provided valuable services to Walmart and their driver partners, enabling quick and easy access to funds through their business accounts – an important fact omitted from the bureau's press release. ”
The CFPB alleges in its lawsuit that both companies violated federal law for two years starting in 2021. The company and the branch are accused of using drivers' information, including their Social Security numbers, to open accounts without permission. The agency alleges that drivers' wages were deposited into the accounts without their permission, resulting in drivers paying more than $10 million in fees to the branch to immediately transfer their earnings to the accounts of their choice.
The allegations involved the Spark Driver program run by Bentonville, Arkansas-based Walmart, in which gig economy workers signed up to make “last-mile” deliveries to and from Walmart stores across the country. Branch is a financial technology company that offers deposit accounts at Evolve Bank & Trust.
CFPB in May filed A trial Against Solo Funds, another partner of Evolve, accused of deceiving borrowers about the total cost of the loan. In June the Federal Reserve issued an enforcement action against West Memphis, Arkansas-based Evolve. Search It failed to properly monitor its fintech partners.