CFPB Fines Apple and Goldman Sachs Over Apple Card Dispute

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Key Takeaways

  • Fines amounting to $89 million have been levied against Apple and Goldman Sachs.
  • The fines have been imposed by The Consumer Financial Protection Bureau (CFPB).
  • The issue arose because the companies illegally mishandled transaction disputes.

Apple has been ordered to pay a $25 million civil penalty to the CFPB’s victims relief fund.

Fines amounting to $89 million have been levied against Apple and Goldman Sachs by The Consumer Financial Protection Bureau (CFPB). A report by The Verge indicates that the issue arose because the companies illegally mishandled transaction disputes and misled iPhone buyers about interest-free payment options with the Apple Card.

The CFPB has mentioned that this very issue has affected over hundreds of thousands of Apple Card users. The CFPB further adds that the Cupertino company failed to send “tens of thousands” of Apple Card transaction disputes to Goldman Sachs. Additionally, Goldman Sachs is said to have failed to complete timely inquiries on the received disputes in accordance with federal law.

As per the report, cardholders were misinformed about automatically receiving interest-free financing when they purchase Apple made devices via the Apple Card. However, many were unknowingly charged interest because they were not enrolled as expected. The Consumer Financial Protection Bureau (CFPB) also noted that Apple only displayed the interest-free financing option in Safari for online shoppers.

As a result, Apple has been ordered to pay a $25 million civil penalty to the CFPB’s victims relief fund. Goldman Sachs will pay at least $19.8 million in redress, a $45 million civil penalty, and must present a credible compliance plan before introducing any future credit card products.

Apple has reportedly tried to end its partnership with Goldman Sachs and is looking to work with JPMorgan as far as the Apple Card is concerned,.