FILE PHOTO: Signs are seen outside Capital One Bank in Manhattan, New York, US, November 12, 2021.
Andrew Kelly | Reuters
Consumer Financial Protection Bureau Announce Tuesday that he was suing Capital One To mislead consumers about the interest rates on their savings accounts and “tricky” them out of over $2 billion in interest.
The agency said in a statement that Capital One deceived holders of its “360 Savings” account by combining it with a newer, higher-yielding savings account option, the “360 Performance Savings” account. The bank allegedly failed to notify 360 Savings account holders of the newer option and marketed the two products similarly to lead customers to believe they were the same.
However, the interest rates for the two options were vastly different, according to the CFPB. Capital One raised the Savings 360 interest rate from 0.4% in April 2022 to 4.35% in January 2024, while lowering and then freezing the 360 interest rate at 0.3% between late 2019 and mid-2024, the agency said.
Despite the relatively low interest rate, the CFPB claimed, the 360 Savings Account was advertised as a high-interest savings account. Capital One aims to keep 360 Savings users in the dark about the higher yield option by replacing all references to the account with the similarly named 360 Performance Savings option on its website, excluding account holders from marketing campaigns advertising the higher yield, the bureau said. Account and prevent employees from notifying account holders of the Performance 360 provisioning option.
“The CFPB is suing Capital One for defrauding families of billions of dollars in their savings accounts,” CFPB Director Rohit Chopra said in a press release. “Banks should not feed people with promises they cannot keep.”
In a statement, Capital One denied the allegations and said it transparently marketed its Performance 360 savings account.
“We are extremely disappointed to see the CFPB continue its recent pattern of filing lawsuits before a change in administration. We strongly disagree with their claims and will defend ourselves vigorously in court,” the company said in a statement.
The bank added that the Performance Savings 360 product was “marketed extensively, including on national television, with the simplest and most transparent terms in the industry.”
