The terms of the proposed settlement would require Capital One to pay a total of $425 million to any depositor who opened, maintained, or otherwise used a 360 Savings account at any point after September 18, 2019.
Capital One has agreed to pay nearly $500 million to settle allegations that it deprived savings account holders of an opportunity to earn more money in interest by failing to inform them of opportunities to transfer funds to higher-yielding accounts.
According to Reuters, a notice detailing the preliminary offer of settlement was filed late on Friday in an Alexandria, Virginia-based federal court. The settlement is not final, and it will require a judge’s approval before any funds can be disbursed.
The lawsuit was filed on behalf of Capital One savings account-holders, who claimed that Capital One had promised high interest rates on its 360 Savings accounts—while simultaneously offering much more favorable rates to newer customers opening similarly-named 360 Performance Savings accounts.
The plaintiffs said that the terms of their 360 Savings accounts capped their rates at about 0.3%, whereas 360 Performance Savings rates hit an all-time high of 4.35% in 2024.
The 360 Performance Savings Account currently offers yields of about 3.6%.
The terms of the proposed settlement would require Capital One to pay a total of $425 million to any depositor who opened, maintained, or otherwise used a 360 Savings account at any point after September 18, 2019.
Despite the potential settlement, Capital One is continuing to litigate related claims.
Earlier this week, on Wednesday, New York Attorney General Letitia James announced that she had filed a lawsuit on behalf of all eligible depositors located in her state.
In her complaint, James said that Capital One’s failure to inform existing customers of the higher-yield accounts culminated in “artificially low” rates and returns.
“Capital One assured high returns with no catches, then pulled the rug out from under their customers and hoped nobody would notice,” James said in a statement announcing the lawsuit. “Big banks are not allowed to cheat their customers with false advertising and misleading promises.”
The federal Consumer Financial Protection Bureau also filed a lawsuit against Capital One at the end of former President Joe Biden’s term. However, the claim was quickly dropped under President Donald Trump, with newly-appointed White House budget director Russell Vought calling Capital One’s business model “innovative.”
The CFPB also recently abandoned a lawsuit against SoLo Funds; Vought subsequently sought to reassure Americans that the Bureau will take no further action to defend the public against predatory and otherwise unlawful business practices.
“More to come,” Vought said in a social media post. “The weaponization of ‘consumer protection’ must end.’”
Sources
Capital One to pay $425 million to settle litigation over savings accounts
Capital One to Pay $425 Million to Settle Suits Over Savings Accounts
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