A US financial regulator has started its investigation into reports that the credit limits set by the Apple credit card for men and women causes gender discrimination.
New York's Department of Financial Services (DFS) is investigating complaints that algorithms used in the Apple Card to set limits might be inherently causing gender discrimination against women. The DFS has contacted Goldman Sachs, which runs the Apple Card, about the issue.
In a recent Bloomberg report, tech entrepreneur David Heinemeier Hansson complained that the Apple Card gave him 20 times the credit limit that his wife got. Hansson pointed out that he got a higher credit limit despite his wife having a better credit score.
In a tweet, Apple's co-founder Steve Wozniak mentioned that he had a similar experience as Hansson, with him being given a higher credit limit despite him and his wife having no separate bank accounts or separate assets.
Wozniak wrote in his tweet: "The same thing happened to us. We have no separate bank accounts or credit cards or assets of any kind. We both have the same high limits on our cards, including our AmEx Centurion card. But 10x on the Apple Card."
Machine-learning technology is increasingly being used by banks and lenders in their processes in order to cut costs and boost loan applications. Hansson, who created the programming tool Ruby on Rails, argued that the Apple Card incident demonstrates how algorithms, not just people, can discriminate.
Previously, UnitedHealth Group faced a similar issue after customers claimed that its algorithm favored white patients over black patients.
The DFS released a statement saying that it "will be conducting an investigation to determine whether New York law was violated and ensure all consumers are treated equally regardless of sex".
"Any algorithm that intentionally or not results in discriminatory treatment of women or any other protected class violates New York law," added the DFS.
