The Consumer Financial Protection Bureau has ordered Goldman Sachs Bank USA to pay a combined $64.8 million following a consent order issued on 23 October 2024, citing systemic failures in how the bank managed customer disputes and billing practices under the Apple Card credit card programme. The penalty comprises a $45 million civil money penalty together with at least $19.8 million in consumer redress directed to affected cardholders.
The CFPB's findings centre on several categories of violation, including the following: Goldman Sachs systematically failed to process consumer disputes correctly; made adverse reports to credit reporting agencies on disputed amounts before completing required billing-error investigations; failed to issue timely billing error decision letters within the timeframes required under federal consumer protection law; and misled consumers about the interest-free Apple Card Monthly Installments option for Apple device purchases, leaving thousands of cardholders with interest charges they had not expected to incur.
BAN ON NEW CREDIT CARD PRODUCTS
Beyond the financial penalties, the bureau imposed a restriction on new credit card products. The bank is prohibited from launching any new credit card product unless it can first provide regulators with a credible compliance plan demonstrating that the proposed product will meet all applicable legal requirements. The CFPB indicated that this prohibition is intended to prevent a repeat of the operational failures identified in the Apple Card programme before the bank expands further in consumer credit.
The Apple Card programme was launched in 2019 as a partnership in which Goldman Sachs acted as the issuing bank responsible for all credit card operations, while Apple co-managed the programme on the customer interface and technology side. In a separate action announced alongside the Goldman Sachs order, the CFPB also fined Apple $25 million for its role in marketing and servicing the Apple Card.
CONSUMER REDRESS
The CFPB indicated that the failures affected a large population of Apple Card customers, with incorrect dispute handling meaning that some cardholders were left bearing charges that should have been resolved in their favour under the bank's own dispute procedures and federal billing error rules. Goldman Sachs must provide at least $19.8 million in consumer redress.
Goldman Sachs consented to the order without admitting or denying the findings, and must carry out a redress plan under the bureau's oversight.
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