Capital One was sued on Wednesday by New York Lawyer Basic Letitia James, who accused the financial institution of dishonest depositors with its flagship “high interest” financial savings accounts out of tens of millions of {dollars} in curiosity.
The lawsuit adopted the Shopper Monetary Safety Bureau’s determination in late February to drop a comparable lawsuit, following a change in that company’s management and President Donald Trump’s return to the White Home.
In a criticism filed in Manhattan federal courtroom, James mentioned Capital One promised depositors one of many nation’s highest rates of interest on their 360 Financial savings accounts, but froze their fee at simply 0.30% whilst rates of interest rose nationwide.
She mentioned Capital One additionally stored these depositors at nighttime in September 2019 when it launched 360 Efficiency Financial savings accounts, whose rates of interest peaked at 4.35%.
James mentioned Capital One by no means informed the depositors they may earn extra by switching accounts, and even informed workers to say nothing until clients requested.
“Customers opened and maintained 360 Savings accounts based on Capital One’s promises that they would receive ‘one of the nation’s best savings rates,’” the criticism mentioned. “Instead, Capital One took advantage of its customers and hoped that they wouldn’t notice.”
The lawsuit accused McLean, Virginia-based Capital One in all violating New York client safety legal guidelines. It seeks civil fines and restitution to clients.
“We strongly disagree with the attorney general’s claims and will vigorously defend ourselves in court,” Capital One mentioned in an announcement.
Capital One added that 360 Efficiency Financial savings “has always been available in just minutes to all new and existing customers without any of the usual industry restrictions.” The account now yields 3.6%.
James mentioned her lawsuit “seeks to ensure that Capital One does not escape accountability” after the CFPB ended its case.
Final month, Capital One settled personal nationwide litigation within the Alexandria, Va., federal courtroom over the 360 Financial savings accounts. Phrases haven’t been disclosed.
Capital One expects to finish its $35.3 billion takeover of Uncover Monetary Companies on Might 18.
The case is New York v. Capital One NA et al, U.S. District Court docket, Southern District of New York, No. 25-04037.
