Capital One has agreed to a $425 million settlement to resolve a class-action lawsuit alleging the bank misled customers by keeping them in low-interest savings accounts while offering a significantly higher rate on a nearly identical product. The settlement, which awaits final court approval, could result in payments to millions of current and former account holders.
The lawsuit, filed in the United States federal court in Alexandria, Virginia, centered on Capital One’s handling of its savings products. According to court documents, the bank marketed its “360 Savings” account as a high-yield option. However, in 2019, it launched a new product called the “360 Performance Savings” account, which offered a much higher annual percentage yield (APY). While rates on the new Performance Savings account rose with national interest rates, peaking at 4.3% in 2022, the rate on the older 360 Savings account was allegedly frozen at just 0.3%.
Plaintiffs in the case claimed that Capital One did not inform existing 360 Savings customers about the new, higher-earning account, nor did it automatically convert their accounts. This practice, the lawsuit alleged, was a deceptive “bait and switch” that caused customers to miss out on more than $2 billion in potential interest earnings between 2019 and 2025.
The allegations were echoed by the Consumer Financial Protection Bureau (CFPB), which filed its own lawsuit against Capital One earlier this year for the same practices. The CFPB accused the bank of making “false or otherwise misleading” representations about the 360 Savings account being one of the “nation’s best.” Although the CFPB later dropped its suit, the class-action case proceeded, culminating in the proposed settlement. As part of the agreement, Capital One has not admitted to any wrongdoing.
Who is Eligible for a Payment?
The settlement class includes all current and former customers who maintained a Capital One 360 Savings account at any point between September 18, 2019, and June 16, 2025. This includes individuals with joint or co-held accounts.
How the Settlement Fund Will Be Distributed
The $425 million fund is divided into two main parts:
- $300 million will be distributed as cash payments to eligible class members. According to the settlement terms, these payments are intended to compensate customers for the amount they “would have earned if their 360 Savings account(s) had paid the interest rate then applicable to the 360 Performance Savings account.”
- $125 million is allocated for future interest payments to customers who still hold an active 360 Savings account. These accounts will now earn an interest rate that is “at least two times the national average rate for savings deposit accounts as calculated by the FDIC.”
The exact payment amount for each individual will depend on their account balance and the duration they held the account during the class period. It is estimated that individuals who have already closed their 360 Savings account may receive a 15% larger one-time payout compared to those who keep their accounts open.
What You Need to Do
Eligible individuals do not need to file a claim to receive a payment, as distributions will be automatic. However, there are important dates to keep in mind. Class members have until October 2, 2025, to visit the official settlement website, CapitalOne360SavingsAccountLitigation.com, to update their mailing address or select a preferred payment method, such as direct deposit. Those who do not make a selection will receive a physical check mailed to their last known address.
The final approval hearing for the settlement is scheduled for November 6, 2025. If the court approves the agreement, payments are expected to be distributed approximately 60 days after the hearing.
