Capital One has been sued by the Consumer Financial Protection Bureau for allegedly purposefully misguiding customers on its savings accounts offerings and cheating them out of more than $2 billion in interest payments.
Filed Tuesday, the lawsuit compares two savings accounts provided by the bank, its widely offered “360 Savings” account and its deliberately obscured “360 Performance Savings” account.
The suit alleges that the “only thing that has ever meaningfully distinguished 360 Performance Savings from 360 Savings is the former product’s higher interest rate” and claims that Capitol One froze the rate for 360 Savings accounts at just 0.30% between December 2020 to at least August 2024 even as rates rose nationwide; a rate that falls far short of the level represented in its marketing," the Bureau said in a statement.
Despite the low rate, Capital One sold the idea to consumers that its 360 Savings account was a “high interest” account with a variable rate that was “one of the nation’s” “top,” “best,” and “highest,” the Bureau said.
Meanwhile, 360 Performance Savings accounts had a much higher rate which, at one point, was more than 14 times higher than that of the 360 Savings accounts. The CFPB alleges that Capital One forbade its employees “from proactively telling” customers about the 360 Performance Savings accounts plan, despite being more beneficial to them, and “instead worked to keep them in the dark.”
“Capital One did not convert 360 Savings accounts into 360 Performance Savings accounts and instead took steps to obscure from 360 Savings accountholders the fact that these were different products,” the statement said.
The CFPB add that Capital One “illegally avoided paying billions in interest to millions of consumers” through these actions, and said its seeking to impose civil penalties and bestow financial relief to customers impacted by them.
Capital One disagreed with the claims presented by the CFPB’s suit and said that the bank will “vigorously defend” itself in court, per the Associated Press. They also added that it was “deeply disappointed to see the CFPB continue its recent pattern of filing eleventh-hour lawsuits ahead of a change in administration.”
