U.S. Accuses Capital One Of ‘Cheating’ Savings Account Holders Out Of $2 Billion In Interest
by Ty Roush · ForbesTopline
Financial regulators on Tuesday accused Capital One of “cheating” millions of customers of more than $2 billion in interest by freezing the rate on their accounts even as rates soared nationwide.
Key Facts
The Consumer Financial Protection Bureau alleges Capital One claimed its “360 Savings” accounts provided the “top,” “best” and “highest” rates before freezing the rate at just 0.30%, even as deposit rates rose nationwide, and prevented account holders from switching into new higher-yielding “360 Performance Savings” accounts.
Capital One introduced “360 Performance Savings” accounts in 2019, a savings account option identical to “360 Savings” accounts but with higher interest rates, including as high as 4.25% by August 2024, the CFPB claims.
Between 2019 and 2024, the bank “schemed” to keep “360 Savings” account holders from switching to the higher-yielding “360 Performance Savings” option by replacing all references to “360 Savings” accounts with references to the “360 Performance Savings” option on Capital One’s website without notifying customers the products were different.
Existing “360 Savings” account holders were also excluded from a marketing campaign for the new “360 Performance Savings” accounts, the CFPB alleges, as Capital One prohibited its employees from telling “360 Savings” account holders about the higher-yielding option.
The CFPB has requested Capital One pay fines, restitution and additional relief for victims at amounts that would be determined by a court.
Capital One did not immediately respond to a request for comment.
Crucial Quote
CFPB director Rohit Chopra said in a statement Capital One is “cheating families out of billions of dollars on their savings accounts,” adding, “Banks should not be baiting people with promises they can’t live up to.”
Key Background
In October, Capital One disclosed in a filing the CFPB was investigating the bank over its savings accounts and the agency was considering “enforcement action.” The bank was previously sued in July 2023 by savings account holders, who alleged Capital One failed to raise interest rates for “360 Savings” account holders despite promising a variable high interest rate, or rates that change over time. Those claims were consolidated in June 2024 and a trial is scheduled for July, according to Capital One, which has filed to dismiss the complaint. The CFPB has increased its enforcement in recent months, with recent lawsuits against Walmart, JPMorgan Chase, Bank of America and Wells Fargo, and Apple and Goldman Sachs. The actions come ahead of President-elect Donald Trump’s inauguration, as Trump’s administration will reportedly ease the agency’s oversight. Elon Musk, tapped by Trump to lead the new cost-cutting Department of Government Efficiency, called to “Delete CFPB” in November.