The Consumer Financial Protection Bureau (CFPB) has fined Apple and Goldman Sachs $89m for misleading customers and customer service breakdowns.
Following an investigation, the CFPB found that Apple failed to send tens of thousands of consumer disputes of Apple Card transactions to Goldman Sachs. Furthermore, when Apple did send disputes to the bank, Goldman Sachs did not follow numerous federal requirements for investigating the disputes.
Additionally, the US watchdog found that the two organisations misled consumers about interest-free payment plans for Apple products. Many customers assumed they would automatically get interest-free monthly payments when buying Apple devices with an Apple Card, but this wasn’t the case.
The watchdog said that, in some cases, customers were not even able to see the interest-free payment option on certain browsers. This issue was worsened by Goldman Sachs also misleading consumers about applying some refunds, which led to consumers paying additional interest charges.
CFPB also believes that the pair rushed the launch of the Apple Card, with the bank receiving third-party warnings that the Apple Card disputes system was not ready. These technological issues continued after launch and led to long wait times to get money back from disputed charges, as well as false negative information added to their credit reports.
Rohit Chopra, Director at CFPB, commented: “Apple and Goldman Sachs illegally sidestepped their legal obligations for Apple Card borrowers. Big Tech companies and big Wall Street firms should not behave as if they are exempt from federal law,
Following these findings, the CFPB has ordered Goldman Sachs to pay at least $19.8m in redress and a $45m civil money penalty. As for Apple, the tech giant will pay a $25m civil money penalty.
Additionally, the CFPB is also banning Goldman Sachs from launching a new credit card unless it can provide a credible plan that the product will actually comply with the law.
Chopra concluded: “The CFPB is banning Goldman Sachs from offering a new consumer credit card unless it can demonstrate that it can actually follow the law.”
