The US Consumer Financial Protection Bureau (CFPB) has filed a lawsuit against Walmart and fintech company Branch Messenger, accusing them of forcing over a million delivery drivers to use costly deposit accounts to access their paychecks, CNN reported.
According to the complaint, the companies allegedly opened these accounts without authorization, using workers’ personal information, including Social Security numbers.
The lawsuit claims that Walmart’s Spark Drivers, categorized as independent contractors, were required to have their earnings deposited into Branch accounts since 2021, with warnings that refusing could cost them their jobs. Drivers allegedly faced “complex processes” and delays lasting weeks to access their earnings, contrary to promises of instant access. The CFPB also alleges that drivers incurred $10 million in “junk fees” for transferring their wages to other bank accounts.
“Companies cannot force workers into getting paid through accounts that drain their earnings with junk fees,” CFPB Director Rohit Chopra said in a statement. The lawsuit describes the typical Spark Driver as a low-income woman, often with children and no college degree.
Walmart has denied the claims, describing the lawsuit as “riddled with factual errors” and accusing the CFPB of not allowing the company a fair chance to defend itself during the investigation.
“We look forward to vigorously defending the Company before a court that honors the due process of law,” Walmart said in a statement Monday.
Branch also rejected the allegations, asserting that it provides “quick and easy access to funds” and accusing the CFPB of rushing the lawsuit for media attention. The company stated it had cooperated extensively with the investigation but was met with no meaningful engagement from the agency.
This lawsuit amplifies the ongoing debate over protections and proper classification for gig workers, who rely on freelance roles through platforms like Uber, Lyft, and DoorDash. Earlier this month, the CFPB also filed lawsuits against major banks, including JPMorgan Chase and Wells Fargo, over alleged failures to address fraud on the money-sending app Zelle.
The case’s trajectory may shift with changes in leadership at the CFPB. As President-elect Donald Trump is expected to appoint a new director, the case’s outcome may hinge on the incoming leadership’s priorities, according to Jaret Seiberg, a financial services policy analyst at TD Cowen Washington Research Group.
