Capital One has been ordered to pay over $2 billion after a lawsuit filed by the Consumer Financial Protection Bureau (CFPB) alleged that the bank artificially kept interest rates low for its high-yield savings accounts. The CFPB claimed that Capital One deliberately confused its customers about the differences between two account options, 360 Savings and 360 Performance Savings, which offered higher interest rates.
The lawsuit stated that the only meaningful difference between the two accounts was the higher interest rate of 360 Performance Savings, which was unfairly kept secret from existing customers. This practice was deemed deceptive and abusive by regulators.
Capital One has disputed the claims, but the CFPB’s Tia Elbaum said that where there are violations of the law, the agency will take action. The fine is part of a recent trend of the CFPB taking swift action against major financial institutions in the final days before a change in administration.
This development comes as Capital One prepares to acquire credit-card issuer Discover and faces increased scrutiny from regulators. The case highlights the importance of transparency in banking practices and the need for clear communication between consumers and financial institutions.
Source: https://www.nytimes.com/2025/01/14/business/capital-one-cfpb-lawsuit.html