Capital One reaches $425 million in class action lawsuit
Capital One has agreed to pay $425 million to resolve a class action lawsuit that includes 360 savings accounts.
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Capital One has resolved a class action lawsuit filed against a bank holding company for allegedly frozen savings account fees for years, effectively banning customers from winning billions of dollars on interest payments.
A settlement means the capital the customer may repay for lost payments. The deadline for obtaining a portion of the $425 million settlement is Thursday, October 2nd.
Although agreed, the review is scheduled for hearing on November 6th, so it is awaiting court approval.
There is everything you need to know about some of the lawsuits and settlements.
Who sued Capital 1?
A $425 million settlement, derived from a class action lawsuit filed in the US federal court in Alexandria, Virginia against client capital in 2024, has been filed in the US federal court in Alexandria, Virginia, according to a notice obtained by USA Today. Earlier this year, the Consumer Financial Protection Bureau (CFPB) also sued Capital One, claiming that the company had frozen that rate over the years despite rising national rates. As a result, customers were fooled from losses in interest payments of more than $2 billion, according to CFPB.
In a statement on January 14, the CFPB said Capital One will sell 360 savings accounts as “high interest” at variable rates, which are “one of the country’s best,” and consumers will earn significantly higher interest than average savings or money market accounts. The CFPB described these expressions as “false or misleading.”
The CFPB dropped the lawsuit in February, but Capital One agreed to pay a $425 million settlement for an individual class action lawsuit filed in 2024.
CFPB and customers were not the only customers suing Capital 1. This is because attorney general Letitia James complained in May that “misleading the interest rates received by customers in online savings accounts and that banks can avoid paying the high interest rates they have promised to customers.”
On Wednesday, September 24th, James announced that he had led a bipartisan coalition of 17 other attorney generals in opposition to the proposed $425 million class action settlement.
On September 24, James and the Coalition filed a document providing the court with additional information, arguments or expertise that the parties involved in the case may not otherwise provide. The document “urges the court to argue that it is not liable, and will make the customer’s sacrifice to the customer to not approve the $425 million settlement.”
USA Today contacted Capital One on Wednesday, October 1st, but there was no response.
Why is Capital accused?
The lawsuit filed against Capital One accused 360 savings accounts of marketing as “high profit” accounts with “one of the country’s highest savings rates.” The account claimed that it would “have more customers than average savings accounts.”
However, the Attorney General, Customers and the CFPB claim that while interest rates have risen nationwide, Capital One is artificially keeping interest rates on its 360 savings accounts low.
The company is also accused of creating 360 performance savings. This is a different type of savings account that offered 14 times higher interest rates at some point.
Capital One is said to have spent more than $2 billion in interest payments on its customers.
What are the conditions for the settlement?
Customers who held a Capital One 360 savings account between September 18, 2019 and June 16, 2025 will be subject to a portion of the settlement.
According to the Capital One Settlement website, no billing form is required to receive payments. All payment classes members are automatically entitled to receive their class cash payments.
Members may choose to receive payments electronically in place of checks.
How much money will the claimant receive?
According to a news release of the settlement, the $425 million settlement will be split into a $300 million cash settlement fund that will be used to make cash payments to all 360 savings account holders in connection with account balances. $125 million to “used to be used to increase interest in the future for customers who continue to maintain 360 savings accounts.”
Customers who have already closed 360 savings, or who have chosen to close before October 2, will receive a class of cash payments estimated to be around 15% greater than if their accounts remain open.
Customers can close their accounts even after receiving larger payments.
The deadline for choosing your payment method is Thursday, October 2nd.
What happens if we don’t accept a settlement?
The customer may choose to exclude himself from the settlement. That option allows them to individually appeal for capital at their own costs. Choosing to opt out means that the client will not receive payments from the Settlement Fund.
Michelle Del Rey is a trending news reporter for USA Today. Contact her at mdelrey@usatoday.com
