In a significant move, the Consumer Financial Protection Bureau (CFPB) has filed a lawsuit against Walmart and its financial services division, alleging deceptive practices linked to its banking operations targeting gig economy workers. The lawsuit, initiated on December 21, 2024, claims that Walmart’s Branch service imposed misleading and unnecessary fees, particularly on delivery drivers, further exacerbating the financial strains often faced by individuals in the gig economy. CFPB Director, Rohit Chopra, stated in a press release, “Walmart should not take advantage of the most vulnerable among us by adding excessive fees on top of their hard work. This lawsuit aims to protect consumers from predatory practices.”
The formal complaint, lodged in a federal court in Washington D.C., specifies that Walmart’s Branch service has allegedly charged up to 15% of each payment processed for drivers using their deposit accounts to manage their earnings. The CFPB claims that these fees are not only unjustified but also misleading, as they do not reflect the actual cost of services provided.
Additionally, the CFPB mentioned that over 50 million gig workers in the U.S. often struggle with variable incomes and thus require transparent and fair banking options tailored to their needs. The lawsuit seeks to recover funds for affected consumers while also pushing for punitive actions against Walmart to deter similar practices in the future.
In response, Walmart stated that it intends to contest the lawsuit vigorously, emphasizing that Branch has been designed to offer affordable services to help gig economy workers manage their earnings. A Walmart spokesperson noted, “We are committed to providing accessible banking options and will defend our practices that help gig workers meet their financial needs.”
The outcome of this lawsuit could have profound implications for the gig economy and highlight the vulnerabilities faced by its workforce, as well as the responsibility of major corporations in offering fair and transparent financial services.
