Federal regulator opens up investigation into Apple Card over gender discrimination accusation

Viral Tweet About Apple Card Leads to Probe Into Goldman Sachs

Apple Inc AAPL.O co-founder Steve Wozniak joined in the online debate over accusations of gender discrimination by the algorithm behind the iPhone maker's credit card, fuelling scrutiny of the newly launched Apple Card.

What just happened? Angry tweets from veteran programmer David Heinemeier Hansson, creator of Ruby on Rails and co-founder of Basecamp, went viral yesterday after alleging that the algorithm making credit decisions for the Apple Card, backed by Goldman Sachs, is making inherently sexist decisions. In a tweetstorm (linked below), he noted that despite having similar financials, his wife was issued a lower credit limit on her Apple Card. According to the entrepreneur, the maximum loan amount that he was allowed to take was about 20 times more than the amount that his wife could get.

David Heinemeier Hansson vented on Twitter that even though his spouse, Jamie Hansson, had a better credit score and other factors in her favor, her application for a credit line increase had been denied.

Though Apple is yet to respond to the investigation into the card, media reports quoted a Goldman Sachs spokesperson saying: "Our 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".

He adds: "Goldman and Apple are delegating credit assessment to a black box". It became available in the United States in August.

NY law prohibits discrimination against protected classes of individuals, which means an algorithm, as with any other method of determining creditworthiness, can not result in disparate treatment for individuals based on age, creed, race, color, sex, sexual orientation, national origin, or other protected characteristics.

Hansson's original tweet was shared nearly 5,000 times and garnered a lot of attention, including from the New York Department of Financial Services, who have confirmed that they will be investigating to see if the algorithm is inherently gender-biased.

The same thing happened to us. "It's big tech in 2019", said Wozniak.

Goldman Sachs is being investigated for possible sex discrimination in the way it sets credit limits on the Apple Card. A press release announcing the card called Goldman Sachs "a newcomer to consumer financial services" that was "creating a different credit card experience".

The inventor of Apple's first computers said he had been offered ten times the credit limit of his wife Janet Hill despite the fact that the couple had "no separate bank or credit card accounts or any separate assets".