New York State Attorney General Letitia James filed a lawsuit against Capital One on Wednesday. In her complaint, James accused the bank of misleading clients regarding its “high interest” 360 savings accounts, claiming millions in lost interest for depositors.
This legal action comes on the heels of a decision by the Consumer Financial Protection Bureau (CFPB) in February, which coincided with changes in its leadership and the Trump administration’s shift in priorities, including dropping a similar lawsuit.
According to the lawsuit filed in Manhattan federal court, James asserted that Capital One advertised some of the highest interest rates in the nation for its 360 savings accounts but effectively capped the rates at just 0.30%, even as rates increased across the country.
She also pointed out that when Capital One launched its 360 performance savings accounts in September 2019, it failed to inform depositors that they could potentially earn more by switching accounts. Employees were reportedly instructed not to disclose this information unless clients specifically asked.
James noted, “Clients have maintained these accounts based on promises of receiving one of the highest savings rates in the country,” stating that instead, Capital One attempted to obscure its practices from customers.
The lawsuit alleges violations of New York’s consumer protection law, seeking both civil penalties and reimbursements for affected consumers.
Capital One stated it would “vigorously contest” the Attorney General’s allegations and defend itself in court.
In its defense, Capital One mentioned that the 360 performance savings accounts offer access to high rates—currently at 3.6%—without the restrictions often found in the industry.
James emphasized the need for accountability, asserting that her lawsuit comes after the CFPB concluded its own inquiry.
Notably, last month, Capital One settled a nationwide lawsuit involving 360 savings accounts, although the details of that settlement remain undisclosed.
Additionally, Capital One is poised to finalize its $35.3 billion acquisition of Discover Financial Services on May 18.
This case is filed under New York v. Capital One, US District Court, Southern District of New York, No. 25-04037.
