Apple Card partner Goldman Sachs facing CFPB investigation


Apple’s partner bank for the Apple Card, Goldman Sachs, has disclosed that it is facing an investigation by the Consumer Financial Protection Bureau. The investigation is focused on Goldman’s credit card account management practices in the United States, of which Apple Card is a major component.

As reported by Reuters, Goldman disclosed the investigation in its quarterly form 10-Q filed with the US Securities and Exchange Commission.

The Consumer Financial Protection Bureau (CFPB) is the top United States agency and watchdog for consumer protection in the financial sector. The investigation into Goldman Sachs is centered on the bank’s credit card account management practices, which include a number of different factors.

Goldman said it is cooperating with the CFPB investigation in its filing with the SEC:

The firm is cooperating with the Consumer Financial Protection Bureau in connection with an investigation of GS Bank USA’s credit card account management practices, including with respect to the application of refunds, crediting of nonconforming payments, billing error resolution, advertisements, and reporting to credit bureaus.

Goldman Sachs only recently started pushing into the consumer credit card business in the United States; its partnership with Apple for the Apple Card is the largest initiative it has taken so far. Reuters points out that its only other primary consumer credit card offering is a co-branded credit card with General Motors.

Apple relies on Goldman Sachs for much of the Apple Card’s financial backend. This includes things like approvals and denials, credit limits, disputes, credit bureau reporting, and much more.

Apple Card sexism allegations

Shortly after its launch, Apple and Goldman Sachs faced accusations that gender discrimination was affecting the algorithms used to determine credit limits for Apple Card. These accusations prompted an investigation by the New York Department of Financial Services.

Goldman responded to the accusations by saying its credit decisions are “based on a customer’s creditworthiness and not on factors like gender, race, age, sexual orientation, or any other basis prohibited by law.” Apple 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 that Apple Card is at least included in the investigation, given the large role it plays in Goldman’s consumer credit card business.

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