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The U.S. Consumer Financial Protection Bureau ordered Goldman Sachs and Apple to pay $89 million, and Goldman was temporarily banned from issuing new credit cards, because of the companies’ mishandling of their Apple Card partnership. The failures left customers with unresolved charge disputes and, in some cases, incorrect credit reports.Apple neglected to send tens of thousands of Apple Card disputes to Goldman Sachs, the CFPB said. When Apple did inform Goldman of disputes, “the bank did not follow numerous federal requirements for investigating the disputes,” according to the CFPB.The government watchdog said the companies launched their credit card initiative prematurely, even as third parties warned them that the disputes system wasn’t ready for prime time because of tech problems.“These failures meant that consumers faced long waits to get money back for disputed charges, and some had incorrect negative information added to their credit reports,” the CFPB said in a statement.The CFPB also found that the companies misled customers about interest-free payment plans for Apple gadgets, including the iPhone. The purchases were not free of interest.Goldman was fined $45 million and will have to pay customers $20 million in redress. Apple was fined $25 million.The CFPB also banned Goldman Sachs from launching a new credit card, “unless it can provide a credible plan that the product will actually comply with the law.”Goldman and Apple did not immediately respond to a request for comment.In a 2022 SEC filing, the bank disclosed that the CFPB was investigating its “credit card account management practices” such as its handling of refunds and billing disputes.The fine is yet another hit to Goldman’s flailing consumer lending business – this year, it also ended its credit card partnership with General Motors, replaced by Barclays.The Apple Card issued by Goldman Sachs and running on the Mastercard network rolled out in August 2019. By Sept. 30 of that year, Goldman had already lent out about $10 billion, and customers had $736 million in loan balances.Goldman broke into the retail consumer business after establishing its online Marcus brand in 2016. Marcus made unsecured personal loans, including to consumers who are dealing with credit card debt.In April 2023, Apple announced it would be offering its Apple Card holders a 4.15% high-yield savings account with Goldman Sachs. They may park both the 3% cash back they receive from using the Apple Card on select purchases plus other savings they may wish to deposit.
The U.S. Consumer Financial Protection Bureau ordered Goldman Sachs and Apple to pay $89 million, and Goldman was temporarily banned from issuing new credit cards, because of the companies’ mishandling of their Apple Card partnership. The failures left customers with unresolved charge disputes and, in some cases, incorrect credit reports.
Apple neglected to send tens of thousands of Apple Card disputes to Goldman Sachs, the CFPB said. When Apple did inform Goldman of disputes, “the bank did not follow numerous federal requirements for investigating the disputes,” according to the CFPB.
The government watchdog said the companies launched their credit card initiative prematurely, even as third parties warned them that the disputes system wasn’t ready for prime time because of tech problems.
“These failures meant that consumers faced long waits to get money back for disputed charges, and some had incorrect negative information added to their credit reports,” the CFPB said in a statement.
The CFPB also found that the companies misled customers about interest-free payment plans for Apple gadgets, including the iPhone. The purchases were not free of interest.
Goldman was fined $45 million and will have to pay customers $20 million in redress. Apple was fined $25 million.
The CFPB also banned Goldman Sachs from launching a new credit card, “unless it can provide a credible plan that the product will actually comply with the law.”
Goldman and Apple did not immediately respond to a request for comment.
In a 2022 SEC filing, the bank disclosed that the CFPB was investigating its “credit card account management practices” such as its handling of refunds and billing disputes.
The fine is yet another hit to Goldman’s flailing consumer lending business – this year, it also ended its credit card partnership with General Motors, replaced by Barclays.
The Apple Card issued by Goldman Sachs and running on the Mastercard network rolled out in August 2019. By Sept. 30 of that year, Goldman had already lent out about $10 billion, and customers had $736 million in loan balances.
Goldman broke into the retail consumer business after establishing its online Marcus brand in 2016. Marcus made unsecured personal loans, including to consumers who are dealing with credit card debt.
In April 2023, Apple announced it would be offering its Apple Card holders a 4.15% high-yield savings account with Goldman Sachs. They may park both the 3% cash back they receive from using the Apple Card on select purchases plus other savings they may wish to deposit.