The New York Department of Financial Services is opening a probe into the new Apple Card\u2019s algorithms when determining credit limits after series of tweets from a technology entrepreneur in the past few days alleged gender discrimination.<\/p>\n
The Apple Card is a joint venture between Apple Inc
A series of posts from David Heinemeier Hansson starting Thursday criticized the Apple Card for giving him 20 times the credit limit that his wife got. Hansson is known as being behind the popular programming tool Ruby on Rails. He\u2019s a partner at Basecamp, a web-based software development firm. <\/p>\n Hansson didn\u2019t disclose any income for himself or his wife but said they filed joint tax returns and that his wife has a better credit score than he does.<\/p>\n \u201cThe department will be conducting an investigation to determine whether New York law was violated and ensure all consumers are treated equally regardless of sex,\u201d said a spokesman for Linda Lacewell, the superintendent of the New York Department of Financial Services, according to a Bloomberg report.<\/a> \u201cAny algorithm, that intentionally or not results in discriminatory treatment of women or any other protected class of people violates New York law.\u201d<\/p>\n \u201cOur credit decisions are based on a customer\u2019s creditworthiness and not on factors like gender, race, age, sexual orientation or any other basis prohibited by law,\u201d Goldman spokesman Andrew Williams said. <\/p>\n Hansson said Goldman\u2019s response doesn\u2019t explain what happened after he started airing his issues on social media.<\/p>\n \u201cAs soon as this became a PR issue, they immediately bumped up her credit limit without asking for any additional documentation,\u201d he said in an interview. \u201cMy belief isn\u2019t there was some nefarious person wanting to discriminate. But that doesn\u2019t matter. How do you know there isn\u2019t an issue with the machine-learning algo when no one can explain how this decision was made?\u201d<\/p>\n Hansson said his posts had led to an internal review and that he was hopeful it would spark a conversation about black-box algorithms and the inherent biases in those systems.<\/p>\n The use of algorithms by lenders in credit decisions has drawn scrutiny in Congress. In June, the House Financial Services Committee heard about examples of algorithmic decision-making where researchers have found instances of bias targeting specific groups even when there was no intent to discriminate.<\/p>\n \u201cGoldman and Apple are delegating credit assessment to a black box,\u201d Hansson said. \u201cIt\u2019s not a gender-discrimination intent but it is a gender-discrimination outcome.\u201d<\/p>\n This is the second such action from the New York regulator in recent weeks. NY DFS opened a probe against health care giant UnitedHealth Group Inc.
The tweets, many of which contain profanity, went viral on the internet. <\/p>\n The @AppleCard<\/a> is such a fucking sexist program. My wife and I filed joint tax returns, live in a community-property state, and have been married for a long time. Yet Apple\u2019s black box algorithm thinks I deserve 20x the credit limit she does. No appeals work.<\/p>\n \u2014 DHH (@dhh) November 7, 2019<\/a><\/p><\/blockquote><\/div><\/div>\n
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\n \u00a0 and investment bank Goldman Sachs
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\n GS, -0.17%<\/span><\/a><\/span>
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\n \u00a0which is responsible for all the credit decisions on the card. <\/p>\n
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\n UNH, +0.20%<\/span><\/a><\/span>
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\n \u00a0after a study found an algorithm favored white patients over black patients.<\/p>\n\n