Apple and Goldman Sachs have been fined $89 million for numerous Apple Card violations following a years-long investigation by the Consumer Financial Protection Bureau (CFPB), the financial watchdog announced today.
According to the CFPB, Apple and Goldman Sachs engaged in deceptive action when dealing with Apple Card consumer disputes. The agency says Apple failed to send “tens of thousands” of Apple Card disputes to Goldman Sachs, with the bank failing to follow federal requirements when dealing with said disputes.
CFPB alleges that Apple and Goldman Sachs launched the Apple Card knowing beforehand that the dispute system wasn’t ready due to unnamed “technological issues.” As a result of this negligence, Apple Card users usually had to wait longer to get their disputed transactions revoked, with some even having their credit scores negatively affected.
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As a result, Goldman Sachs has been ordered to pay nearly $65 million in redress and civil money penalty, with Apple being fined $25 million in civil money penalty. Goldman Sachs has also been banned from launching a new consumer credit card until it can provide it has implemented new measures to avoid breaking the law.
CFPB further states that Apple and Goldman Sachs deceived Apple Card users who wanted interest-free payment plans when purchasing Apple products with the credit card, as most consumers thought the interest-free plans would be applied automatically. In some cases, Apple didn’t showcase an interest-free plan for users checking out through third-party browsers.
The fine should be the final nail in the coffin for the relationship between Apple and Goldman Sachs as the bank is willing to terminate its Apple Card partnership and exit the consumer loans market altogether. Apple is looking for new banking partners like JPMorgan Chase to take over from Goldman Sachs soon.
