CFPB Sues Walmart and Branch Messenger over Alleged Exploitation of Gig Workers

By Evans Momodu
4 minute read

The Consumer Financial Protection Bureau (CFPB) has filed a lawsuit against Walmart and fintech company Branch Messenger, accusing them of forcing over a million delivery workers to use costly deposit accounts to access their paychecks.

According to the complaint, Walmart’s Spark Drivers—classified as independent contractors responsible for delivering packages—were required to have their earnings deposited into Branch accounts.

The CFPB alleges that the accounts were opened without the drivers' consent, using personal information such as Social Security numbers. Drivers were reportedly threatened with job loss if they refused to use the accounts.

Allegations against Walmart and Branch

• Unauthorised Accounts: The CFPB claims Walmart opened accounts without workers’ consent.
• Delays in Accessing Pay: Workers faced a "complex process" to access their earnings, sometimes experiencing weeks-long delays despite promises of instant access.
• Excessive Fees: Drivers allegedly paid $10 million in “junk fees” to transfer wages to their own bank accounts.
• Worker Demographics: The lawsuit states that many Spark Drivers are low-income, women with children, and lack college degrees, making the alleged practices particularly exploitative.

CFPB Director Rohit Chopra criticised the practices, stating, “Companies cannot force workers into getting paid through accounts that drain their earnings with junk fees.”

Walmart has denied the claims, calling the lawsuit “rushed” and “riddled with factual errors.” The company expressed confidence in defending itself in court, arguing that it was denied due process during the CFPB’s investigation.

Branch Messenger similarly denied wrongdoing, asserting that its services provide “quick and easy access to funds.” The company accused the CFPB of prioritising media attention over workers’ rights or legal accuracy.

Broader Implications for Gig Workers

This lawsuit highlights growing calls for better protections and clearer classifications for gig workers, who often rely on freelance jobs via apps like Uber, Lyft, and DoorDash. Advocates argue these workers face systemic exploitation due to their lack of traditional employment rights.

Earlier this month, the CFPB also targeted major banks—including JPMorgan Chase, Bank of America, and Wells Fargo—for allegedly failing to prevent fraud on the money transfer app Zelle.

What’s Next?

The lawsuit's outcome may hinge on future leadership at the CFPB, with President-elect Donald Trump expected to appoint a new director.

Analysts suggest the case’s trajectory could shift depending on the new administration's stance on gig economy regulations.

Both Walmart and Branch have pledged to defend themselves vigorously, setting the stage for a potentially significant legal battle in the gig economy landscape.
Source: CNN 
Image: Times of India