The Consumer Financial Protection Bureau (CFPB) in the United States is suing Capital One, accusing the American bank of illegally misleading millions of consumers, preventing them from receiving over $2 billion in interest.
In a press release on Tuesday (January 14th), the CFPB stated, “The Consumer Financial Protection Bureau alleges that Capital One promised consumers that its flagship product, ‘360 Savings’ account, offered one of the ‘best’ and ‘highest’ rates nationwide, but the bank froze its rate at a low level while national rates were rising.”
“At around the same time, Capital One introduced a nearly identical product, ‘360 Performance Savings,’ which differed from ‘360 Savings’ only in that it paid significantly higher interest – at one point exceeding the rate of ‘360 Savings’ by 14 times,” the agency continued, “Capital One did not clearly notify ‘360 Savings’ account holders about the new product, but instead made efforts to keep them unaware of these higher-yielding accounts.”
“The Consumer Financial Protection Bureau alleges that Capital One concealed this new product from its ‘360 Savings’ account holders, causing millions of consumers to lose over $2 billion in interest income. The CFPB’s lawsuit aims to stop these companies’ illegal activities, provide compensation to affected consumers, and impose civil penalties, which will be deposited into the CFPB’s Consumer Relief Fund,” the federal regulatory agency added.
Capital One denied these allegations. The bank holding company stated in a release on Tuesday, “We are disappointed to see the Consumer Financial Protection Bureau continue its recent pattern of filing lawsuits at the final moments before a government turnover. We strongly disagree with their assertions and will vigorously defend ourselves in court.”