Apple and Goldman Sachs ordered to pay $89M over Apple credit card failure
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The Consumer Financial Protection Bureau (CFPB) on Wednesday ordered Apple and Goldman Sachs to pay $89 million for mishandled transaction disputes and misrepresentations that affected hundreds of thousands of people. Apple Card users.
The CFPB found a breakdown in how Apple Card’s customer service handled consumer disputes, as Apple failed to report tens of thousands of disputes Goldman Sachs and in sending them, the bank failed to comply with the government’s requirements to investigate disputes.
The organization noted that the companies launched the Apple Card despite warnings from third parties about technical problems with the Apple Card dispute system. That has led to long waits for consumers to receive refunds on disputed charges and some to have inaccurate information on their credit cards.
The CFPB also found that Apple and Goldman Sachs misled consumers about interest-free payment plans for Apple devices, as many customers thought they would be automatically enrolled in interest-free payments but were charged interest and in some cases could not see what was interest-free. payment option on the Apple website if you use certain browsers.
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Apple CEO Tim Cook introduced the Apple Card in March 2019. (Noah Berger/AFP via / Getty Images)
The CFPB ordered Goldman Sachs to pay at least $19.8 million in restitution and a $45 million civil penalty, while Apple was ordered to pay a $25 million civil penalty. It also prevented Goldman Sachs from launching a new one credit card unless it provides a reliable assurance that the product will comply with the law.
| A ticker | Security | Finally | Change | Change % |
|---|---|---|---|---|
| AAPL | Company APPLE INC. | 230.76 | -5.10 |
-2.16% |
| GS | GOLDMAN SACHS GROUP INC. | 517.17 | -1.09 |
-0.21% |
“Apple and Goldman Sachs illegally exceeded their legal obligations to the Apple Card borrowers,” it said CFPB Director Rohit Chopra. “The CFPB is barring Goldman Sachs from offering a new consumer credit card unless it can demonstrate that it can actually comply with the law.”
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Goldman Sachs served as Apple’s financial partner for the Apple Card. (Andrew Kelly/File Photo / Reuters Images)
“The Apple Card is one of the most consumer-friendly credit cards ever,” Goldman Sachs spokesman Nick Carcaterra told FOX Business. “We have worked diligently to address some of the technical and operational challenges we encountered post-launch and have addressed them with affected customers. We are pleased to have reached a settlement with the CFPB and are proud to have built such a beneficial new product alongside Apple.”
“Apple is committed to providing consumers with fairness and transparency financial products,” an Apple spokesperson told FOX Business. “The Apple Card is one of the most consumer-friendly credit cards available, and is specifically designed to support users’ financial health. Upon learning of these inadvertent problems years ago, Apple worked closely with Goldman Sachs to quickly resolve and assist affected customers. “
“While we strongly disagree with the CFPB’s characterization of Apple’s conduct, we have agreed with them in the settlement. We look forward to continuing to deliver a great experience to our Apple Card customers,” Apple’s statement concluded.
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Apple and Goldman Sachs reach settlement with CFPB over Apple Card matters. (Faris Hadziq/SOPA Images/LightRocket via/Getty Images)
In November 2023, The Wall Street Journal reported that Apple proposed to end its credit card relationship with Goldman Sachs in the next 12 to 15 months.
The Journal previously reported in the summer of 2023 that Goldman Sachs was in talks with him transfer Apple Card partnership in another financial services company.
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