Mishandling of customer disputes and other matters regarding Apple Card payments landed the vendor and partner Goldman Sachs with a combined $89.8 million penalty in the US, after a government agency ruled the companies failed to meet their legal obligations.

The Consumer Financial Protection Bureau (CFPB) noted hundreds of thousands of Apple Card customers were impacted by a breakdown in customer service and misrepresentation after it found the device maker had not provided Goldman Sachs with details of disputes or the bank failed to properly investigate those which were sent through.

Consumers faced lengthy waits to recoup disputed fees and some had erroneous information added to their credit reports.

The CFPB noted Goldman Sachs ignored warnings Apple’s dispute handling system was not technologically capable before it launched the credit card product. The companies also misled consumers about interest-free payment schemes covering the vendor’s devices, with many not realising this was not triggered automatically.

Apple also failed to even offer its interest-free option on some browsers, the CFPB stated.

CFPB director Rohit Chopra argues the companies “sidestepped their legal obligations”.

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Big tech companies and big Wall Street firms should not behave as if they are exempt from federal law

Rohit Chopra – director US Consumer Financial Protection Bureau

Goldman Sachs portion of the fine involves “at least” $19.8 million in redress and a $45 million civil penalty, with Apple penalised to the tune of $25 million.

The CFPB also prohibited Goldman Sachs from launching a new credit card “unless it can provide a credible plan that the product will actually comply with the law”.

A hand holding a smartphone over a small square card reader, suggesting a contactless payment is being made. The smartphone screen displays a digital card. The background is plain and white.

Apple launched its credit card product in 2019 in partnership with Goldman Sachs, which the CFPB noted had begun a move into the consumer sector in 2016.

The agency noted the card offered Apple a means to boost device sales along with incentivise purchases at its retail outlets, but the move almost immediately faced problems over claims of gender bias in credit limits.

Reuters reports Goldman Sachs stated it was pleased to have arrived at a resolution and Apple had yet to respond at the time of publishing.