Apple, US Bank Latest to Exit CFPB Enforcement Actions Early

Apple Inc. and US Bancorp escaped separate enforcement actions by the Consumer Financial Protection Bureau several years before the agency was supposed to stop monitoring the companies.

The terminations, posted to the CFPB’s website Monday, mean that both Cupertino, Calif.-based Apple and Minneapolis-based US Bank will get an early reprieve from CFPB oversight ensuring the companies abide by the settlements.

The CFPB under Biden-era Director Rohit Chopra had accused Apple of customer service violations for Apple Card users, while US Bank faced charges tied to customer unemployment accounts that were frozen at the height of the Covid-19 pandemic.

The terminations are the latest in a string of early close-outs as the CFPB looks to clear existing enforcement and supervisory actions before anticipated workforce cuts due to GOP-imposed budget caps.

The CFPB has also terminated enforcement actions against Navy Federal Credit Union, allowing it to escape $80 million in customer redress, and against Toyota Motor Credit Corp., letting it avoid returning $40 million to customers.

The CFPB, Apple, and US Bank didn’t immediately respond to requests for comment Tuesday.

Apple Card Action

The CFPB ordered Apple and Goldman Sachs Group Inc. to pay a combined $89 million in fines and customer redress last October over customer service breakdowns and misrepresentations that affected hundreds of thousands of Apple Card users.

Apple and Goldman also misled customers about interest-free payment plans for Apple devices, the CFPB alleged.

The CFPB ordered Apple to pay a $25 million civil money penalty and subjected it to five years of compliance monitoring, while Goldman was ordered to pay nearly $20 million in customer redress and a $45 million fine. But the early termination relieves Apple from compliance monitoring after less than a year.

Goldman’s enforcement action and compliance monitoring are still active as of Tuesday morning.

Unemployment Claims

US Bank agreed to return $5.7 million in redress and pay a $15 million civil money penalty in a December 2023 enforcement action from the CFPB alleging unfair practices on prepaid debit cards the bank issued for state unemployment benefits. The conduct related to account freezes and other security measures.

The CFPB’s compliance monitoring was scheduled to last five years under the settlement.

The Office of the Comptroller of the Currency separately fined US Bank $15 million for the same practices concurrently with the CFPB. That settlement didn’t have a compliance-monitoring component.