Capital One Accused of Misleading Customers on Savings Rates
(Bloomberg) — Capital One Financial Corp. misled customers when it rolled out a new savings account with a higher interest rate it didn’t also give to existing savings accounts, the Consumer Financial Protection Bureau said Tuesday in a lawsuit against the bank.
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Capital One introduced the 360 Performance Savings Account in 2019, with an interest rate that eventually rose to 4.25%, according to the complaint. That was far higher than the 0.3% offered on the bank’s existing savings account product, called 360 Savings. The CFPB alleges that the bank promised existing customers one of the US’s “top,” “best” and “highest” interest rates through their 360 Savings account, according to the lawsuit, filed in the US District Court for the Eastern District of Virginia.
“The CFPB is suing Capital One for cheating families out of billions of dollars on their savings accounts,” CFPB Director Rohit Chopra said in a statement. “Banks should not be baiting people with promises they can’t live up to.”
A Capital One spokesperson said the bank is disappointed by the agency’s “recent pattern of filing 11th-hour lawsuits ahead of a change in administration,” and that the bank will defend itself in court.
The firm has been embroiled in several separate class-action lawsuits over this matter, dating back to 2023. The McLean, Virginia-based bank disclosed the CFPB’s probe in an October filing.
Customers missed out on more than $2 billion in lost interest payments, the CFPB said in the statement. The agency seeks to change the bank’s behavior and impose monetary penalties with the lawsuit.
The complaint follows myriad regulatory and legal actions from Chopra ahead of President-elect Donald Trump’s inauguration next week. Just before year-end, the agency sued Walmart Inc. and JPMorgan Chase & Co. in separate actions and finalized a slew of new rules.
In the October filing, Capital One said the agency informed the bank that month that it was considering an action based on similar claims to those mentioned in the class actions.
(Updates with estimate of lost interest payments, other details in sixth paragraph.)
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