Capital One, a leading U.S. banking company, recently reached a $425 million settlement to resolve a major class action lawsuit involving 360 Savings accounts. This settlement brought financial relief to millions of customers. The focus of the case was the bank’s decision to keep interest rates on existing 360 Savings accounts relatively constant, while offering significantly higher returns on new accounts.
The interest rate on 360 Savings accounts remained at just 0.3% from September 2019 to June 2025. In contrast, the interest rate on 360 Performance Savings accounts increased to 4.3% in 2022. According to the Consumer Financial Protection Bureau (CFPB), this difference resulted in an estimated loss of over $2 billion to customers.
Although the CFPB concluded its lawsuit in February 2025, the class action litigation continues. Ultimately, Capital One opted for a settlement, which ensured compensation for past losses to eligible customers and improved interest rates in the future.
Why the Settlement?
The case alleged that Capital One misrepresented the 360 Savings account as a high-return option, when in reality, its interest rate was significantly lower than the market average. Customers claimed they were not given accurate information about the 360 Performance Savings account’s superior performance, which impacted their earnings.
Through the settlement, Capital One chose to avoid further legal battles in the future. While the bank did not admit any wrongdoing, a $425 million fund was created to ensure justice for customers and demonstrate responsibility in financial practices.
Who Can Claim?
The settlement is comprehensive and includes both former and current 360 Savings account holders.
Here are the eligibility details for the settlement:
- Account Type: 360 Savings Account
- Term: September 18, 2019 – June 16, 2025
- Status: Current and former account holders are eligible
This broad eligibility means that even customers who closed their accounts years ago may be eligible to claim.
Who will receive the payment?
The settlement provides relief to customers in two parts.
- Reimbursement of past earnings: Customers will receive the interest they should have received in a 360 Performance account.
- Future protection: Active 360 Savings accounts will now offer interest at least twice the FDIC national average rate.
- This structure means it not only compensates for past losses but also prevents future account disparities.
Settlement Process Timeline
The settlement process will be completed under court supervision, and clear deadlines have been established for customers.
- Deadline for Submitting Claims/Objections: October 2, 2025
- Final Approval Hearing: November 6, 2025
- Payment Disbursement: After Court Approval, After Claims Are Processed
Customers must submit their claims on time to remain eligible for settlement payments.
Importance of This Case
This case is considered significant from a consumer protection perspective. It shows that financial institutions can be held legally responsible when they mislead or harm customers.
Capital One marketed the 360 Savings Account as an attractive option, while customers were left with interest rates well below market rates. This settlement proves that class action litigation can be an important tool in securing justice for customers.
What Should Customers Do?
Account holders should check their eligibility and prepare to submit a claim before the October 2025 deadline. The size of the payment will depend on the account balance and the length of time the funds have been held in the 360 Savings account.
The settlement not only compensates for past losses but also helps ensure fairer returns in the future. Customers should monitor their account performance and compare available options to avoid similar problems in the future.
Conclusion
Capital One’s $425 million class action settlement in 2025 brings relief to millions of customers. This settlement demonstrates that financial institutions must operate with transparency and responsibility.
Customers should check their eligibility, submit claims on time, and be vigilant about their investment and account choices in the future. This case is an excellent example of protecting consumer rights and the accountability of financial institutions.
FAQs
1. What is the Capital One $425M class action settlement about?
A. The settlement resolves a lawsuit concerning Capital One 360 Savings accounts. The lawsuit alleged that the bank offered very low interest rates on older 360 Savings accounts while offering higher returns on new 360 Performance Savings accounts, causing financial losses to customers.
2. Who is eligible for the settlement?
A. Both current and former 360 Savings account holders from September 18, 2019, to June 16, 2025 are eligible to file a claim.
3. How much will customers receive?
A. Payments will depend on the account balance and how long the funds were held in the 360 Savings account. The settlement covers past lost earnings and ensures future accounts yield at least twice the FDIC national average.
