A federal judge has granted final approval of a $425 million settlement in a lawsuit against Capital One, claiming the bank deceived savings account holders.
The dispute was over how Capital One handled the transition from its 360 Savings account, introduced in 2013, to its 360 Performance Savings, an account unveiled in 2019 with a higher interest rate.
“The lawsuit alleged that Capital One acted deceptively regarding the marketing and payment of interest on its 360 Savings account product,” Wolf Popper LLP, a law firm representing the original savings account holders, wrote in a press release Wednesday announcing the finalized settlement.
Judge David Novak, who serves the Eastern District of Virginia, finalized the settlement Monday after the years-long lawsuit. The $425 million settlement is revised from a previous proposal that would have provided less than $300 million in restitution payments, according to federal prosecutors who opposed the original settlement.
The proposal for the new settlement was announced last month. Capital One has denied any wrongdoing and the court has not determined that the bank acted improperly.
Impacted Capital One customers are automatically eligible to receive a payment from the settlement.
Wolf Popper LLP said the 360 Savings account was advertised as its “high interest” savings account for six years until the bank pulled the option from its website and quietly substituted it with the 360 Performance Savings account.
In 2019, the 360 Savings account had an annual percentage yield of 1 percent compared to the 360 Performance Savings account’s 1.9 percent APY.
“Capital One left all existing customers in the inferior 360 Savings account, and never informed them that 360 Performance Savings was a new, different product paying a higher interest rate,” the law firm claimed.
The Independent has reached out to Wolf Popper, Capital One and the U.S. Attorney’s Office for the Eastern District of Virginia for comment.
The approved settlement also requires Capital One to match interest rates on deposits for both savings accounts.
Certain current and former 360 Savings account holders are eligible for benefits from the $425 million settlement and do not need to file a claim form to receive their payment, according to the settlement administrator.
The settlement is for Capital One customers who had a 360 Savings account at any time from September 18, 2019, to June 16, 2025.
Affected customers will receive a check in the mail to their last known address if their payment is worth $5 or more. There was an option to receive an electronic payment, but the option closed on March 30.
The payment will only be given to the primary account holder on the 360 Savings account.
