Apple has commented on the multi-million dollar criminal case by the Consumer Financial Protection Bureau (CFPB) against the Apple Card product. The CFPB, the US watchdog for consumer-facing financial products, ordered Apple and its banking partner Goldman Sachs to pay up. total $89 million Condemned. Goldman Sachs must pay $19.3 million in damages and $45 million in civil penalties, and Apple itself must pay $25 million in civil penalties. The incident involves thousands of complaints from customers about incorrect debits and other disputes. According to the CFPB, Apple either did not forward these to Goldman Sachs or Goldman Sachs did not treat them in accordance with all federal regulations. The CFPB also banned Goldman Sachs from launching new credit card products until it was sure the banking group “complies with the law.”
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Apple Card for the “financial health” of customers
A brief statement given by Apple to the American media said that Apple always strives to offer fair and transparent financial products to consumers. The Apple Card is “one of the most customer-friendly credit cards available.” It was “specifically designed to support the financial health of users.” The problems the CFPB is now fining are “years” old and “incidental.” So they “worked closely with Goldman Sachs to resolve them quickly and help affected clients.” Overall, Apple said it “strongly disagrees” with the characterization of the CFPB’s actions. Nevertheless the company decided to pay the fine. “We have reached a settlement (with the CFPB). We now look forward to continuing to provide a great user experience for our Apple Card customers.”
In addition to problems resolving transaction disputes, the CFPB also accused Apple and Goldman Sachs of “deceiving” customers when making installment payments for iPhones and other Apple products. They were offered interest-free loans, which were not automatically made interest-free if, for example, the customer did not use Apple’s own Safari browser online. Furthermore, the offer was presented to customers in a “confusing” manner. “Thousands of customers” paid the interest. Problems were also reported with “some repayments” for purchases, as Goldman Sachs maintained two accounts for installment payments and regular credit card payments. This also led to unexpected interest payments. Apple did not comment on these details.
Goldman Sachs wants out of business
It has long been known that Goldman Sachs is unhappy with Apple Card. The company repeatedly faced customer service problems and the bank also suffered losses in this segment. Other credit card products for end customers were also not launched or processed. However, since Apple has a long-term contract with Goldman Sachs, the partners remain tied to each other.
Another problem is related to internationalization. Despite the fact that the Apple Card has been on the market for more than five years, it currently exists as a product only in the United States. Goldman Sachs intended to internationalize its private banking business and attempted to enter Great Britain with its retail brand “Marcus”. However, Apple is not included here yet, and Goldman Sachs has now decided to stop internationalization.
(B.Sc.)
