Apple’s CEO, Tim Cook, unveiled the Apple Card at an event at their headquarters in Cupertino, California, back in March 2019. However, recent news indicates that the Consumer Financial Protection Bureau (CFPB) has imposed penalties exceeding $89 million on Apple and Goldman Sachs for mishandling customer disputes linked to Apple Card transactions.

Reportedly, Apple neglected to forward numerous consumer disputes to Goldman Sachs. The CFPB has further accused Goldman Sachs of not adhering to federal requirements during dispute investigations. Consequently, Goldman Sachs has been instructed to pay $45 million as a civil penalty and $19.8 million in compensation. Apple, on the other hand, has been hit with a $25 million fine.

Rohit Chopra, CFPB Director, criticized Apple and Goldman Sachs for evading their legal responsibilities towards Apple Card users, emphasizing that large tech and Wall Street companies are not exempt from federal law.

Launched in 2019, the Apple Card was marketed as a more straightforward and transparent alternative to traditional credit cards. The card was developed in collaboration with Goldman Sachs, with the card’s functionality based on Apple Pay, Apple’s digital wallet service. In December of that year, the companies introduced a feature allowing cardholders to finance specific Apple devices with interest-free monthly payments.

However, the CFPB has charged Apple and Goldman Sachs with misleading consumers about these interest-free payment plans. Customers who purchased Apple devices with an Apple Card expected automatic interest-free monthly payments but were still charged interest. According to the CFPB, Goldman Sachs failed to clarify how the refunds would work, leading to extra interest charges for some consumers and inaccurate credit reports.

Goldman Sachs’ vice president of corporate communications, Nick Carcaterra, responded to the allegations, assuring that they had addressed the issues and were proud of their partnership with Apple. Apple, while disagreeing with the CFPB’s characterization of their conduct, confirmed they had reached an agreement with the bureau.

This news is essential for potential Apple Card users and anyone interested in investing, underscoring the importance of clear communication and transparency in financial services.