The Consumer Financial Protection Bureau (CFPB) said Tuesday that it had filed a lawsuit against Capital One, accusing the bank of “cheating millions of consumers out of more than $2 billion in interest.”
CFPB Sues Capital One: Says Company Cheated Consumers Out of Over $2bn in Interest Payments
The lawsuit alleges that Capital One deceived customers about its 360 Savings accounts, promising “best” and “highest” interest rates while freezing those rates at low levels despite rising interest rates across the market.
The CFPB further claims that Capital One simultaneously introduced a similar product, the 360 Performance Savings account. This is said to have offered substantially higher rates – at one point, more than 14 times the 360 Savings rate.
The bureau alleges that Capital One deliberately concealed the existence of the 360 Performance Savings account from existing 360 Savings customers, preventing them from switching to the more lucrative option and ultimately costing them billions in potential earnings.
The CFPB’s lawsuit seeks to stop the company’s unlawful conduct, provide redress for harmed consumers, and impose civil money penalties, which would be paid into the CFPB’s victims relief fund.
“The CFPB is suing Capital One for cheating families out of billions of dollars on their savings accounts,” said CFPB Director Rohit Chopra. “Banks should not be baiting people with promises they can’t live up to.”
“Capital One illegally deceived consumers and Capital One, N.A. violated the Truth in Savings Act by representing that 360 Savings provided a variable interest rate that was ‘one of the nation’s’ ‘top,’ ‘best, and ‘highest,’ and would earn much more interest than the average savings account,” added the CFPB.
