Apple’s partner bank for the Apple Card, Goldman Sachs, has revealed that it is under investigation by the Consumer Financial Protection Bureau. The investigation focuses on Goldman’s credit card account management practices in the United States, of which Apple Card is a major component.
As reported by ReutersGoldman disclosed the investigation in its quarterly Form 10-Q filed with the United States Securities and Exchange Commission.
The Consumer Financial Protection Bureau (CFPB) is the primary US agency and watchdog for consumer protection in the financial industry. The Goldman Sachs investigation centers on the bank’s credit card account management practices, which include a number of different factors.
Goldman said it was cooperating with the CFPB investigation in its SEC filing:
Company is cooperating with the Consumer Financial Protection Bureau in an investigation into GS Bank USA’s credit card account management practices, including enforcement of refunds, crediting non-compliant payments , billing error resolution, advertising and credit bureau reporting. .
Goldman Sachs has only recently begun to enter the consumer credit card business in the United States; its partnership with Apple for the Apple Card is the biggest initiative it has taken so far. Reuters points out that its only other major consumer credit card offering is a co-branded credit card with General Motors.
Apple relies on Goldman Sachs for much of the Apple Card financial backend. This includes things like approvals and denials, credit limits, disputes, credit bureau reports, and more.
Apple Card sexism allegations
Shortly after its launch, Apple and Goldman Sachs were accused that gender discrimination affected the algorithms used to determine Apple Card credit limits. These accusations sparked an investigation by the New York Department of Financial Services.
Goldman responded to the charges by saying that its credit decisions are “based on a customer’s creditworthiness and not on factors such as gender, race, age, sexual orientation, or any other basis prohibited by law.” law “. Apple has never publicly responded to the accusations.
At this point, there are no further details on what exactly the CFPB is investigating, but it’s likely Apple Card will at least be included in the investigation, given the significant role it plays in business. consumer credit cards from Goldman.
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