US sues Walmart and Branch Messenger over driver payment accounts

A Walmart truck leaves a Walmart distribution center in Hurricane, Utah on May 30, 2024.

Georges Frey | Afp | Getty Images

The Consumer Financial Protection Bureau on Monday filed a complaint against Walmart and work scheduling platform Branch Messenger for allegedly forcing delivery drivers to use expensive and poorly managed deposit accounts in order to get paid.

“Walmart made false promises, illegally opened accounts, and took advantage of more than a million delivery drivers,” CFPB Director Rohit Chopra said in a statement. “Companies cannot force workers to be paid through accounts that drain their income with unwanted fees.”

The lawsuit alleges that, since 2021, Walmart and Branch have opened branch accounts for more than 1 million drivers under the Spark Driver Program, Walmart's platform for gig economy workers to accept and schedule “last mile” deliveries, then deposited drivers’ pay into these accounts without their consent.

The company allegedly told drivers they would be fired if they did not want to use branch accounts and misled drivers about when they could access their earnings. When drivers used the platform, they would face numerous delays or fees if they had to transfer the money to another account, resulting in more than $10 million in “unwanted fees.”

Walmart disputed the agency's allegations.

“The CFPB's rushed lawsuit is riddled with factual errors and contains gross exaggerations and inaccuracies about established principles of law,” a Walmart spokesperson wrote in a statement to CNBC. “The CFPB never gave Walmart a fair opportunity to present its case during its rushed investigation.”

The CFPB also accused Branch of failing to investigate alleged errors, failing to provide certain information, failing to maintain records, failing to act on stop payment requests, and illegally requiring consumers that they waive their rights under the law.

“Branch strongly disagrees with the lawsuit filed today by the CFPB, which misrepresents the law and facts and includes intentional omissions to obscure the Bureau's obvious overreach,” a representative for Branch wrote in a statement to CNBC .

This lawsuit is the latest in a series of actions taken by the CFPB against companies for mishandling the financial accounts of consumers and workers. The bureau previously sued Comerica Bank over allegations that it failed to administer a federal benefits program and charged illegal fees on prepaid debit cards.

Most recently, the CFPB filed a complaint against payment network operator Zelle, as well as JPMorgan Chase, Bank of America, and Wells Fargo, alleging that the companies failed to properly investigate fraud complaints or reimburse the victims. The lawsuit claims customers have lost more than $870 million since Zelle launched in 2017.

Don't miss this information from CNBC PRO

What Are The Main Benefits Of Comparing Car Insurance Quotes Online

LOS ANGELES, CA / ACCESSWIRE / June 24, 2020, / Compare-autoinsurance.Org has launched a new blog post that presents the main benefits of comparing multiple car insurance quotes. For more info and free online quotes, please visit https://compare-autoinsurance.Org/the-advantages-of-comparing-prices-with-car-insurance-quotes-online/ The modern society has numerous technological advantages. One important advantage is the speed at which information is sent and received. With the help of the internet, the shopping habits of many persons have drastically changed. The car insurance industry hasn't remained untouched by these changes. On the internet, drivers can compare insurance prices and find out which sellers have the best offers. View photos The advantages of comparing online car insurance quotes are the following: Online quotes can be obtained from anywhere and at any time. Unlike physical insurance agencies, websites don't have a specific schedule and they are available at any time. Drivers that have busy working schedules, can compare quotes from anywhere and at any time, even at midnight. Multiple choices. Almost all insurance providers, no matter if they are well-known brands or just local insurers, have an online presence. Online quotes will allow policyholders the chance to discover multiple insurance companies and check their prices. Drivers are no longer required to get quotes from just a few known insurance companies. Also, local and regional insurers can provide lower insurance rates for the same services. Accurate insurance estimates. Online quotes can only be accurate if the customers provide accurate and real info about their car models and driving history. Lying about past driving incidents can make the price estimates to be lower, but when dealing with an insurance company lying to them is useless. Usually, insurance companies will do research about a potential customer before granting him coverage. Online quotes can be sorted easily. Although drivers are recommended to not choose a policy just based on its price, drivers can easily sort quotes by insurance price. Using brokerage websites will allow drivers to get quotes from multiple insurers, thus making the comparison faster and easier. For additional info, money-saving tips, and free car insurance quotes, visit https://compare-autoinsurance.Org/ Compare-autoinsurance.Org is an online provider of life, home, health, and auto insurance quotes. This website is unique because it does not simply stick to one kind of insurance provider, but brings the clients the best deals from many different online insurance carriers. In this way, clients have access to offers from multiple carriers all in one place: this website. On this site, customers have access to quotes for insurance plans from various agencies, such as local or nationwide agencies, brand names insurance companies, etc. "Online quotes can easily help drivers obtain better car insurance deals. All they have to do is to complete an online form with accurate and real info, then compare prices", said Russell Rabichev, Marketing Director of Internet Marketing Company. CONTACT: Company Name: Internet Marketing CompanyPerson for contact Name: Gurgu CPhone Number: (818) 359-3898Email: [email protected]: https://compare-autoinsurance.Org/ SOURCE: Compare-autoinsurance.Org View source version on accesswire.Com:https://www.Accesswire.Com/595055/What-Are-The-Main-Benefits-Of-Comparing-Car-Insurance-Quotes-Online View photos