@Tobin
I’ve had my ‘oh shit’ fund with CIT Bank for a couple of years now. Sitting at 4.35% currently.
What’s in your wallet? (a lot less than you thought!)
I’ve been a ING Direct/Capital One customer for a while and helped my girlfriend open accounts. One day she asked me about the interest rate, and I was like, this makes no sense. She called, and they explained this. I was like, this is really deceptive. Glad something came of this.
The Consumer Financial Protection Bureau (CFPB) accuses Capital One of freezing the interest rates of its flagship ‘360 Savings’ accounts at low levels despite rates rising nationwide and said the bank launched a new account that offered better interest rates without telling ‘360 Savings’ customers. That decision cost consumers over $2 billion in lost interest payments.
…
Capital One marketed the ‘360 Savings’ account using terms like ‘one of the nation’s,’ ‘top,’ ‘best,’ and ‘highest’ to describe the interest earned. However, the CFPB said that from 2019 to mid-2024, the bank ‘lowered and then froze’ the 360 Savings account rate to just 0.30%, even as rates increased nationwide.
This is why you should compare interest rates periodically. Unless there was language in the account opening tying rates to treasury rates or some index, I’m not sure how big of a deal this is. Of course, a company will try to market its product as ‘one of the best’. If there were an advertisement claiming it was the highest interest rate, then I could see it being false advertising, but this just reads as marketing fluff.
@Rudy
In 2019, the 360 Savings interest rate was good at ~1% and was one of the nation’s highest. They never actually said the account would stay one of the nation’s best, like Ally does. Once the new account came out, they discontinued the old one.
I’m in this hobby to steal money from banks, so I hope they lose, but it’ll be a hard proof. They told everyone to switch; customers just didn’t because they didn’t want to change accounts or read their mail/advertisements.
@Dev
The complaint alleges that Capital One took proactive steps to avoid notifying existing bank customers of new savings account products. Executives ‘explicitly forbade’ employees from proactively notifying existing customers about the new account. Targeted advertising to keep existing customers in the dark is also alleged. If they have documents to that effect, that’s not a good look. I use Capital One as my bank and primary card provider but hope they pay a hefty price for this.
@Davin
Agreed, if that’s part of it, they should be punished, though it might not be illegal.
@Rudy
I hope Capital One wins this one. Absolutely ridiculous lawsuit.
Jensen said:
@Rudy
I hope Capital One wins this one. Absolutely ridiculous lawsuit.
Why?
Jensen said:
@Rudy
I hope Capital One wins this one. Absolutely ridiculous lawsuit.
Capital One allegedly knowingly made materially false representations, benefiting at the expense of customers. It seems pretty cut and dry.
@Tamia
It was scummy, but if their marketing claims are the issue, it’ll go nowhere—qualifiers make those claims meaningless. I can say you’re one of the richest people in the world without knowing your wealth.
If they lose this suit, the precedent could be confusing at best.
If they lose, what does this mean for other banks? This appears to be normal marketing practice—almost every bank promotes high-interest rates at some point.
@irmah
The 32-page complaint lays out actual violations of law: 3 violations of CFPA, 2 counts TISA/Regulation DD.
Having similar products isn’t illegal, but deceptively marketing them as identical is.
@Tamia
From the government’s own document:
The new savings product was identical to 360 Savings in every material way—both marketed as ‘high interest’ (or ‘high yield’) savings accounts and had the same terms: variable interest rate, no minimum balance, and no monthly fees—except: 360 Performance Savings has always had a substantially higher interest rate.
@irmah
I love armchair lawyers like this. CFPB doesn’t just sue randomly. If you read the documentation, it’s likely going to trial unless Capital One settles.
@irmah
I hope they lose just because they denied my request for a higher limit every time. Fuck you, Capital One. They’re so stingy.
Jensen said:
@Rudy
I hope Capital One wins this one. Absolutely ridiculous lawsuit.
I hope they lose. It was extremely scummy.
This isn’t unique to Capital One. Truist is doing the same thing with their money market accounts (advertising higher interest rates and then lowering them to a fraction of a percent).
Yeah, up until 6 months ago, I was only getting 0.5% in their money market product. Now, I’m going to churn their checking account SUB to try to take some of their money I missed out on.
Larkin said:
Yeah, up until 6 months ago, I was only getting 0.5% in their money market product. Now, I’m going to churn their checking account SUB to try to take some of their money I missed out on.
They had a $750 SUB for savings accounts that I took advantage of.
Crap-ital One.