Which credit card practices are under investigation by the CFPB?

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Goldman Sachs' Credit Card Practices Under Scrutiny by CFPB

The Consumer Financial Protection Bureau (CFPB) is investigating several aspects of Goldman Sachs' credit card operations. The probe specifically examines the company's procedures for applying refunds, crediting payments that do not conform to requirements, resolving billing errors, its advertising practices, and how it reports information to credit bureaus. Goldman Sachs has stated that it is cooperating with this investigation.
Refund and Payment Crediting Procedures Under Review

A key area of the CFPB's investigation focuses on how Goldman Sachs handles refunds and credits for payments. This includes scrutinizing the precise methods used to apply refunds to customer accounts and the processes for crediting payments that may not meet specific, nonconforming criteria. These details are crucial for ensuring accurate customer billing and account management.
Billing Error Resolution and Advertising Scrutinized

The investigation also extends to Goldman Sachs' systems for resolving billing errors encountered by customers. Furthermore, the CFPB is examining the company's advertising strategies related to its credit card products. This scrutiny aims to ensure that marketing materials are accurate and that customer service effectively addresses any billing discrepancies.
Reporting to Credit Bureaus Subject to Investigation

The practices of reporting customer credit information to credit bureaus are also under examination by the Consumer Financial Protection Bureau. This aspect of the probe looks into how Goldman Sachs transmits data about its credit card customers' payment histories and account statuses to national credit reporting agencies. Accurate and timely reporting is a critical component of consumer credit.
Context of Goldman Sachs' Consumer Business Growth

This investigation occurs as Goldman Sachs continues to expand its consumer-facing financial services. The company launched its Marcus online bank offering in the United States in 2016 and introduced its Apple credit card in 2019. As of the end of June 2022, Goldman Sachs reported nearly US$12 billion in outstanding loans within its credit card segment, a substantial increase that underscores the growing significance of this business line. In the most recent financial quarter, revenues from consumer and wealth management rose by 25 percent to US$2.2 billion.

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Which credit card practices are under investigation by the CFPB?

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