Capital One is being sued by the CFPB for allegedly misleading consumers about its savings rates.

• The Consumer Financial Protection Bureau declared it was taking legal action against Capital One for allegedly defrauding clients out of over $2 billion in interest.
• The banking giant was accused by the agency of using deceptive marketing to hide the differences in interest rates between two of its savings-account options.
• Capital One refuted the accusations and asserted that it extensively marketed its high-yield savings account.

The Consumer Financial Protection Bureau filed a lawsuit against for misrepresenting savings account interest rates and defrauding consumers of over $2 billion in interest, it was announced on Tuesday.

Capital One misled 360 Savings account holders by confusing it with the 360 Performance Savings account, which has a higher yield. The bank failed to notify customers of the newer option and marketed the two products similarly, leading them to believe they were the same.

The interest rates of the two options were significantly different, according to the CFPB. Capital One raised the 360 Performance Savings interest rate from 0.4% in April 2022 to 4.35% in January 2024, while it lowered and then froze the 360 Savings rate at 0.3% between late 2019 to mid-2024, the agency stated.

The CFPB claimed that despite its low interest rate, the 360 Savings account was marketed as a high-interest savings account. The bureau stated that Capital One intentionally kept 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 account, and forbidding employees from notifying account holders about the 360 Performance Savings option.

"Capital One is being sued by the CFPB for deceiving families and stealing billions of dollars from their savings accounts, according to CFPB Director Rohit Chopra in a statement. "Banks should not lure people with false promises they cannot fulfill.""

Capital One denied the allegations and stated that it transparently marketed its 360 Performance Savings account.

The CFPB's recent practice of filing lawsuits at the last minute before a change in administration has left us deeply disappointed. We strongly disagree with their allegations and will fiercely defend ourselves in court.

The 360 Performance Savings product was marketed widely, including on national television, with the simplest and most transparent terms in the industry.