Consumer Financial Protection Bureau says customer complaints weren't handled well
of ConsumerAffairsToday, the Consumer Financial Protection Bureau (CFPB) took action against Apple and Goldman Sachs for problems that affected hundreds of thousands of Apple Card users.
The CFPB found that Apple didnt properly forward tens of thousands of customer complaints about disputed Apple Card transactions to Goldman Sachs. When Apple did send complaints, Goldman Sachs didnt follow federal rules for investigating them.
Apple and Goldman Sachs launched the Apple Card even though Goldman Sachs had been warned about technical problems with the system. As a result, many consumers had to wait a long time to get their money back for disputed charges, and some had incorrect negative information added to their credit reports.
Both companies fined
The CFPB is ordering Goldman Sachs to pay at least $19.8 million to affected customers and a $45 million fine. Apple is being fined $25 million. The CFPB is also banning Goldman Sachs from launching a new credit card unless they can prove they will follow the law.
The CFPB also found that Apple and Goldman Sachs misled customers about interest-free payment plans for Apple devices. Many customers thought they were automatically getting interest-free payments when using Apple Card to buy Apple devices, but instead, they were charged interest. Sometimes, the interest-free option wasnt even shown on Apples website, depending on the browser being used.
Additionally, Goldman Sachs misled some customers about how refunds would be applied, which resulted in extra interest charges.
"Apple and Goldman Sachs broke the law by failing to meet their obligations to Apple Card customers," said CFPB Director Rohit Chopra. "Big Tech and big Wall Street companies must follow the law like everyone else."
Goldman Sachs is one of the largest financial institutions globally, mostly focusing on investment banking. Apple Card was its first major step into credit card lending. Apple, a multinational tech company, began offering financial services in 2014, including Apple Card, which launched in partnership with Goldman Sachs in 2019. This partnership helped Apple boost sales of its expensive devices by offering financing options.
Goldman Sachs was warned
Before the Apple Card launched, Goldman Sachs was warned that the system for handling customer complaints wasnt ready, but both companies pushed ahead anyway. This led to serious issues with how customer disputes were handled, such as Apple not passing along some disputes to Goldman Sachs and Goldman Sachs failing to investigate others properly. Misleading marketing also caused confusion about the interest-free payment plan for Apple devices.
The CFPB is holding both companies accountable for their actions by fining them and demanding better practices in the future.
Photo Credit: Consumer Affairs News Department Images
Posted: 2024-10-23 16:55:21
