Apple and Goldman Sachs fined $130 million in total for misleading consumers about payment options over Apple Card
Since 2019, Apple has partnered with Goldman Sachs to offer its own credit card,
CFPB Orders Apple and Goldman Sachs to Pay Over $89 Million for Apple Card Failures | Consumer Financial Protection Bureau
https://www.consumerfinance.gov/about-us/newsroom/cfpb-orders-apple-and-goldman-sachs-to-pay-over-89-million-for-apple-card-failures/
Apple and Goldman Sachs found millions for misleading Apple Card holders - The Verge
Apple and Goldman Sachs ordered to pay $89 million after Apple Card failures | CNN Business
https://edition.cnn.com/2024/10/23/business/goldman-sachs-apple-card-fine/index.html
According to the CFPB, Apple failed to inform Goldman Sachs of tens of thousands of disputes filed by consumers regarding Apple Card transactions, and Goldman Sachs failed to comply with numerous federal laws to investigate consumer complaints. As a result, Goldman Sachs allegedly included adverse information on consumers' credit reports and held cardholders liable for potentially fraudulent or unauthorized purchases.
In addition, Apple has been offering an interest-free installment payment service to Apple Card users when they purchase Apple products since December 2019. However, the CFPB points out that Apple and Goldman Sachs have misled consumers about the interest-free installment payment service when purchasing Apple products with Apple Card.
Many consumers thought that if they purchased Apple products with Apple Card, they would automatically be able to make installment payments without interest. However, in reality, the interest-free installment payment service was optional when purchasing Apple products and was not automatically enrolled. As a result, consumers who purchased Apple products in installments were charged interest. In addition, the CFPB criticized, 'When it came to enrolling in the interest-free installment payment service, Apple only displayed the plan to users using Safari, and the enrollment process was complicated.'
The CFPB has imposed a civil penalty of $25 million on Apple and a civil penalty of $45 million on Goldman Sachs, in addition to imposing a $19.8 million damages and a civil penalty of $45 million on the bank, and has barred Goldman Sachs from issuing any new credit card products until it has a 'plan to credibly demonstrate that the products are in compliance with the law.'
In response to the decision, an Apple spokesperson said, 'While we accept the CFPB's order, we disagree with the CFPB's arguments. 'The Apple Card is one of the most consumer-friendly credit cards ever offered. Apple has been aware of this issue for several years and worked closely with Goldman Sachs to quickly address it and provide assistance to affected customers.'
Nick Calcaterra, vice president of communications at Goldman Sachs, said, 'We have been working diligently to address certain technical and operational challenges that arose following the launch of Apple Card and have already addressed them for affected customers.' 'We are pleased to have reached an agreement with the CFPB to resolve this matter.'
It has also been reported that Apple and Goldman Sachs may end their partnership and have JPMorgan take over the business due to the deteriorating performance of the high-yield savings service for Apple Card users .
Apple ends partnership with Goldman Sachs, future of Apple Card unclear - GIGAZINE
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