CapOne Hit with $425M Settlement for Cheating Savers

New York Attorney General Letitia James hailed a landmark $425 million settlement against Capital One for defrauding customers of their 360 Savings accounts. The deal, more than doubling the value of an initial proposal, will funnel $34 million directly to New Yorkers and another estimated $530 million in future interest payments nationwide.

Capital One had marketed its 360 Savings as high-interest accounts, yet kept rates artificially low while offering a separate account with significantly higher rates. AG James’ lawsuit accused the bank of misleading customers about promised interest rates, allowing them to avoid paying the high rates they had agreed upon.

The initial proposed settlement was opposed by James and a bipartisan coalition of attorneys general, who argued it failed to adequately compensate affected consumers. Following their objections, the court rejected the first proposal.

The revised settlement requires Capital One to match interest rates between 360 Savings and 360 Performance Savings, eliminating the deceptive two-tiered system. The OAG will dismiss its lawsuit if the revised class action is approved and implemented.

This victory for consumers was achieved by Assistant Attorneys General Adam J. Riff, Chisolm Allenlundy, Nora Van Horn, and former Assistant Attorney General Jason E. Meade, under the guidance of Bureau Chief Jane M. Azia and Deputy Bureau Chief Laura J. Levine. The Consumer Frauds and Protection Bureau operates within the Division of Economic Justice, led by Chief Deputy Attorney General Chris D’Angelo and First Deputy Attorney General Jennifer RULES.