CFPB Ends Apple, Bank of America Oversight Early

The Consumer Financial Protection Bureau (CFPB) has unexpectedly terminated its regulatory oversight of Apple Inc. (AAPL.US) and Bank of America (BAC.US) several years ahead of schedule, according to court documents filed earlier this month. This decision aligns with the policy direction of the Trump administration, which aimed to reduce CFPB's oversight in the consumer finance sector. Previously, the Trump administration had quietly ended CFPB's oversight of Toyota and Bank of America under consent orders, and had also paused nearly all enforcement actions that were ongoing when Trump took office.

In the case of Apple, the CFPB's investigation last autumn revealed that Apple and Goldman Sachs had engaged in improper behavior related to the handling of disputes over the "Apple Credit Card." The companies were found to have misled consumers about whether certain transactions were interest-free, potentially violating consumer protection laws. The initial consent order required Apple to undergo enhanced compliance monitoring and cooperate with relevant audits for five years. However, Apple has already paid the full $25 million civil penalty stipulated in the consent order, which was due in October 2024.

Similarly, Bank of America has also paid the full $15 million penalty imposed by the CFPB. This penalty was related to allegations that the bank had illegally prevented unemployed consumers from accessing their unemployment benefits during the pandemic. The original consent order between Bank of America and the CFPB, reached in 2023, also included a requirement for five years of compliance monitoring and cooperation. The bank has reportedly compensated affected consumers and is taking steps to prevent similar violations in the future.

This premature termination of regulatory oversight by the CFPB suggests a potential shift in the bureau's approach to enforcement and oversight. It remains to be seen how this decision will impact the broader financial industry and consumer protection efforts. While Apple and Bank of America may no longer be subject to the specific consent orders, they will still be required to comply with other regulatory requirements and may face additional scrutiny in the future. The CFPB, Apple, and Bank of America have not yet responded to requests for comment on this development.