Apple Responds After Being Fined Alongside Goldman Sachs for 'Apple Card Failures'

Following an investigation, the Consumer Financial Protection Bureau (CFPB) today announced it has fined Apple and Goldman Sachs nearly $90 million combined for "Apple Card failures" related to "customer service breakdowns" and "misrepresentations."

apple card 1 iPhone 13
Apple and Goldman Sachs have partnered on the Apple Card since its launch in 2019, with Goldman Sachs handling the consumer lending aspects.

Specifically, the CFPB found that Apple and Goldman Sachs violated the U.S. Consumer Financial Protection Act and the U.S. Truth in Lending Act by mishandling transaction disputes and misleading iPhone users about interest-free payment options available when purchasing Apple devices with the Apple Card. These failures impacted "hundreds of thousands of Apple Card users," according to the agency.

"The marketing of the Apple Card Monthly Installments plan led consumers to believe they would automatically receive interest-free financing when purchasing iPhones and other Apple devices with their Apple Card," the CPFB said, resulting in some consumers being "unknowingly charged interest because they were not automatically enrolled as expected."

Here are the CFPB's findings, including Apple failing to send some transaction disputes to Goldman Sachs, Goldman Sachs failing to properly investigate some of the disputes, and Apple and Goldman Sachs misleading cardholders:

Failing to process or share consumer disputes: Apple Card users were directed to dispute transactions through a "Report an Issue" feature in the Wallet app. For some disputes, Apple sent consumers a separate link in the Messages app asking for more information. Apple failed to send these disputes to Goldman Sachs if the second form was incomplete. Even after Goldman Sachs alerted Apple to this issue, the problem persisted. As a result, neither Apple nor Goldman Sachs investigated tens of thousands of such disputes and cardholders were unfairly held responsible for disputed transactions.

Failing to investigate cardholder disputes: For the disputes that Apple did send to Goldman Sachs, the bank failed to consistently send acknowledgment notices within 30 days, conduct reasonable investigations, or send resolution letters explaining the determinations of its investigations within 90 days. These failures led to Goldman Sachs illegally placing damaging information on consumers' credit reports and holding cardholders responsible for potentially fraudulent or unauthorized purchases.

Misleading cardholders about a payment plan for iPhones and other Apple products: The marketing of the Apple Card Monthly Installments plan led consumers to believe they would automatically receive interest-free financing when purchasing iPhones and other Apple devices with their Apple Card. The plan allowed cardholders to purchase Apple devices through a series of interest-free payments over a period of six months to two years. However, many cardholders were unknowingly charged interest because they were not automatically enrolled as expected. They also faced confusing checkout options about enrolling in the plan. For online purchases, Apple only presented the payment plan as an option to consumers using Apple's own Safari browser. Due to Apple and Goldman's actions, instead of making interest-free payments, thousands of cardholders purchased Apple devices on interest-bearing revolving balances and incurred interest charges.

Misleading cardholders about refunds: Cardholders with an Apple Card Monthly Installments plan essentially had two card balances – the plan balance and their interest-bearing revolving balance. For more than 10,000 cardholders, Goldman Sachs misled consumers about how it would apply certain refunds between the two balances. Contrary to Goldman's representations, portions of refunds for unrelated purchases were applied to the interest-free plan balance instead of the interest-bearing revolving balance. As a result, consumers incurred additional and unexpected interest expenses.

Apple has been ordered to pay a $25 million fine, which will go to the CFPB's victims relief fund, while Goldman Sachs is required to pay at least $19.8 million in redress to impacted consumers and a $45 million fine.

In a statement shared with MacRumors, Apple said it strongly disagree[s] with the CFPB's characterization of the company's conduct.

"Apple is committed to providing consumers with fair and transparent financial products," an Apple spokesperson said. "Apple Card is one of the most consumer-friendly credit cards available, and was specifically designed to support users' financial health. Upon learning about these inadvertent issues years ago, Apple worked closely with Goldman Sachs to quickly address them and help impacted customers. While we strongly disagree with the CFPB's characterization of Apple’s conduct, we have aligned with them on an agreement. We look forward to continuing to deliver a great experience for our Apple Card customers."

More details about the CFPB's findings are available on its website.

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Top Rated Comments

vertsix Avatar
26 weeks ago

The Apple Card is the best credit card I've ever owned, and it's my favorite. I love that payments show up instantly, that I get instant cash on transactions, and that I have a pretty high-interest savings account, among other card features.

But that doesn't mean that it's perfect. I haven't had any issues, but obviously others have, hence the CFPB's involvement. Apple and Goldman should stop fighting, pay the fines, stop the illegal conduct, and move on.
Apple Card has a great UI and I agree with your points, but its a HIGHLY average to below average card in terms of rewards. As such, I use other cards and rarely use Apple Card now.
Score: 20 Votes (Like | Disagree)
macsimcon Avatar
26 weeks ago
The Apple Card is the best credit card I've ever owned, and it's my favorite. I love that payments show up instantly, that I get instant cash on transactions, and that I have a pretty high-interest savings account, among other card features.

But that doesn't mean that it's perfect. I haven't had any issues, but obviously others have, hence the CFPB's involvement. Apple and Goldman should stop fighting, pay the fines, stop the illegal conduct, and move on.
Score: 17 Votes (Like | Disagree)
sw1tcher Avatar
26 weeks ago

Why is Apple’s statement crossed out? Is that a posting mistake?
It's because Apple has since issued a new updated statement:

"We are aware that a small number of users were having issues with their [S]third-generation butterfly keyboard[/S] Apple Card and for that we are sorry. The vast majority of [S]Mac notebook customers[/S] Apple Card holders are having a positive experience with the [S]new keyboard[/S] Apple Card."
Score: 13 Votes (Like | Disagree)
Virtualball Avatar
26 weeks ago
I bought a lamp from Europe in January and paid the shipping company with my Apple Card. I can't stress enough what a huge mistake that was. I made sure to purchase insurance on the shipment and of course the lamp arrived shattered. The shipping company gave me the run around for 6 months and kept lying about the insurance company needing more info. Eventually they said the money was on its way but spent months saying "It should be coming soon." Eventually I did a chargeback in July. I sent them pages and pages of our emails, photos of the damage, and more.

Goldman Sachs sided with the shipper.

DO NOT USE YOUR APPLE CARD FOR ANYTHING IMPORTANT.

HELL, DO NOT GET ONE!

THEY DON'T GIVE A **** ABOUT YOU
Score: 10 Votes (Like | Disagree)
jz0309 Avatar
26 weeks ago
Might want to fix that strike through @Joe Rossignol

ive not had issues of any kind with my card …
Score: 8 Votes (Like | Disagree)
WarmWinterHat Avatar
26 weeks ago

This is true for any bank.
I had my AmEx gold skimmed at a gas station a few years ago and the resulting fraudulent charges were fixed and completely gone in less than a week.

My point, however, was the how did my Apple CC number get used half-way across the county when I had never physically used the card online, offline, otherwise, or even used it will Apple Pay?
Score: 7 Votes (Like | Disagree)