- Goldman Sachs may lose money on the Apple Card in the next recession, Nomura says by CNBC via Running With Miles. That acquisition cost seems insane considering there is no sign up bonus and they aren’t running an affiliate program.
- Senator Elizabeth Warren has sent a letter to the Inspector General of the FTC asking for an investigation regarding misleading statements made by the FTC in regards to the Equifax data breach. I do think the statements made by FTC were misleading and they must have known that nobody was going to get the top line figure of $125. This is actually common when it comes to class action settlements, but I still thought it was surprising that the FTC used such definitive language (e.g 10 years of credit monitoring or $125 would have been better phrased as 10 years of credit monitoring or up to $125) and even then the FTC should have been more realistic about the number of people that would choose the cash option. In my opinion the penalty imposed by the FTC was not significant enough and the reason they used that $125 language was because they knew if they gave a more realistic number (most likely under $1) they would have been rightly accused of not going after Equifax hard enough. If you’re going to comment on this specific post, I ask you to discuss the actual topic rather than whatever your political leaning is/your opinion on Warren herself.
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We need to credit EW for the CFPB as she started it around 2008 to protect citizens from sleazy banks and their practices.
Comments are a dumpsterfire lol
I wonder how many people would have to send in a disagreement to the settlement for it to make any difference?
I hate EW and all the things she does BUT she’s 100% right on this. This is absolute BS. FTC did not do its job and we need a judge to step up and this settlement is out. $1 per person isn’t a penalty. It’s hardly even a cost of doing business
The best thing everyone can do regarding the Equifax settlement is Opt Out. If you settle for cash at best you’ll get a pittance, while if you opt out you’ll both preserve your rights, but, more importantly, force the court to consider if the settlement was fair at all. Every class action settlement considers the number of opt outs before being certified, so if this one gets a large number there is a possibility that the judge could toss the whole thing.
5 years is the max Page Thompson, a transgender women will receive for her stealing data from 30 companies. That’s not enough.
While I agree penalties aren’t high enough, for the hacker or companies that don’t do enough to prevent it, what does being transgender have to do with it?
I’m a female software engineer and female hackers are very rare. In this case she’s a transgender but her brain is still a man’s brain.
It really doesn’t matter what gender her anything is.
.
You are discriminating, why is this comment even allowed?
Surely you can’t be saying that were she biologically female and had a “female’s brain”, that you think the penalty would be enough?
Her gender isn’t related to her punishment. I just wanted to point out that female hackers are rare ad the first one I heard in the news in a major hacking case turned out to be transgender.
That’s fine. I hope you recognize how the meaning in your post may be misconstrued though.
There are quite a few female hackers… uncommon, yes, but rare? I dunno. In the security industry as a whole, there seem to be a fair number of transgenders. Check out defcon. Perhap sthey’re more on the white hat side, or maybe black hat, but better at not getting caught!
Liar. I saw “Hackers” in the 90s. Female hackers are all scorching hot women. #facts.
But the main point of your post was that it was a low 5 year max penalty for the crime. Who did the crime is not a factor so there is no point in saying that other than to point it out as if it was a bad thing.
ACLU can sue taxpayers for the gender realignment surgery s/he needs to get transferred out of men’s prison via Manning v. Hagel, et. al. Why not have Capital One’s cybersecurity on the hook for all costs instead of all of us being the ones to pay for yet another data thief’s legal fees and surgery?
And I strongly disagree with all who’d rather tax dollars be used for criminals to be entitled to bigger meals and better healthcare than helping the homeless, mentally ill, and disabled veterans. Stop the hemorrhaging, it’s harming our communities!
terfs gonna terf
Not gonna a lie you sound like a moron bringing up her being transgender here. Or is that just how you talk normally? “My friend Dave, a gay black man, got into a car accident”
If you your male friend had breast cancer it may be relevant to mention the gender since it’s very rare.
Or if your female friend got breast cancer it may be relevant to bring up she is transgender (essentially a man who got breast cancer).
I’m not seeing how that is relevant whatsoever.
lol this is truly retarded but keep fighting for whatever stupid shit you believe in I guess
Well, unlike the other “I’m offended” seekers here, I appreciate the information. I had the same thought about her gender when I read the article: namely, it’s unusual to see a female hacker.
Being a moron isn’t offensive
Her being transgender has nothing to do with it.
In my experience, most hackers I’ve ever met are transgendered.. but I’m from Seattle, so perhaps that makes sense.
That $350 acquisition cost per user doesn’t even make sense
Few things to consider:
1) Goldman Sachs never issued (to my knowledge at least) a credit card before besides the cobranded AMEX Platinum which was managed by AMEX. We have no idea what the cost of setting up the backend of this is.
2) Additionally, we have no idea how many CSR agents they hired or the cost to hiring an outside firm is.
3) No clue what their share in the development cost of the software is.
4) No clue what they presumably paid Apple to be the issuer
5) We have no idea how many people will ultimately sign up for Apple Card
All of that to say — when Chase, Citi, or AMEX launches a new card their fixed costs don’t change. They have to print a new design on a card. Goldman Sachs needed to build the entire backend to go along with it.
If all of the above cost them $2 billion then $350/customer works out to just shy of 6 million customers. Is that a realistic number of people who will get an Apple Card? Who knows.
Goldman will have paid Apple for the cobrand too.
@ Jags, with the possible exception of #4, none of the costs you list are acquisition costs. Those are all very real factors in determining whether Goldman will make money on this, but that doesn’t make them acquisition costs.
I’ve seen journalists conflate fixed costs with variable costs in these sorts of articles before, the numbers make some sense with this logic.
Do you know this for a fact or are you just speculating (serious—not being a jerk)?
I agree many of those costs aren’t traditionally seen as acquisition costs, however, last time I checked we haven’t seen a big bank become a credit card issuer in decades. GS has 1 credit card now so any and all costs associated with rolling out their consumer credit card division can be assigned to this product.
Goldman getting into the mass market card business is like Wells Fargo trying to get into the white shoe inv banking biz. Get your popcorn, and enjoy the show for the next few years. Its interesting that the folks who have actually tasted the sting of chargeoffs and do lots of white label co brand biz (Sychrony, Citi Retail, BOA white label arm whose name escapes me, etc.) were not willing to step up and pay as much as GS to get this ‘opportunity’.
Honestly I think a better partner for GS would have been Costco, IIRC what I 90%+ Exec Membership have six figure incomes and basic membership it’s 75%. But again they had no back-end either so Apple probably allowed them flexibility to set that up. I can see GS having to pay $50-100 per approved Apple customer.
I’ve become friend’s with the local Costco wireless kiosk manager, he said it’s extremely rare to have a customer that can’t get a phone on credit maybe 1-2x a year.
That said with GS approving people w/620 FICO with APRs that are not that much higher than some reward cards APR. They are asking for a large number of COs.
Goldman also owns Marcus. Clearly Marcus isn’t aimed at their stereotypical High Net Worth client.
I didn’t realize banking experts hung out in the comment section of the site that teaches me how to stack apps to save on nachos.
You pulled one number from the writer who never backed up where he got it from. (Probably his ass) and you made up two others. Good thing you ended with “who knows”. Indeed.
Those metal cards aren’t cheap either. Cost to produce and ship is probably $40-50 all in. Similar cost basis for other metal (not plastic wrapped) cards.