Capital One was sued Tuesday by the U.S. Consumer Financial Protection Bureau, which accused the bank of illegally defrauding customers who held its “high-interest” primary savings account out of more than $2 billion in interest payments.
In a complaint filed in federal court in Alexandria, Va., the CFPB said Capital One promised depositors that its 360 Savings account offered one of the “highest,” “best” and “most “highest” of the country, but froze their rate at just 0.30% even as deposit rates rose nationwide.
The CFPB also said Capital One kept 360 Savings depositors in the dark when it launched the 360 Performance Savings account in 2019, which was identical except for carrying a significantly higher interest rate that reached 4.35% in January 2024. .
Capital One allegedly told branch employees not to proactively tell depositors they could switch accounts, or send depositors to the bank’s account conversion unit, unless they asked if conversions were allowed.
“Banks shouldn’t be baiting people with promises they can’t keep,” CFPB Director Rohit Chopra said in a statement.
The CFPB said Capital One stopped offering 360 Savings to new customers when it introduced 360 Performance Savings, which now yields 3.8% annually, according to the bank’s website.
Tuesday’s lawsuit seeks civil penalties, restitution and other remedies for violations of the Consumer Financial Protection Act of 2010 and the Truth in Savings Act.
“We are deeply disappointed to see the CFPB continue its recent pattern of filing eleventh-hour lawsuits before a change in administration,” Capital One said in a statement. “We strongly disagree with their claims and will vigorously defend ourselves in court.”
The McLean, Va.-based bank. added that it marketed the 360 Performance Savings account widely, including on national television, “with the simplest and most transparent terms in the industry” and that its 360 accounts all offer great rates.
Capital One is one of the largest US banks and credit card companies, with $353.6 billion in deposits and $486.4 billion in assets as of September. 30, 2024.
A July 2025 trial in a private nationwide lawsuit over the 360 Savings accounts has been set in Alexandria court.
In a research note, TD Cowen analyst Jaret Seiberg said the CFPB lawsuit should not affect Capital One’s proposed $35.3 billion acquisition of credit card rival Discover Financial Services.
The case is CFPB Vs. Capital One Financial Corp et al, US District Court, Eastern District of Virginia, No. 25-00061.
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