Major credit card company and bank Capital One has found itself in illegal hot water. The company is accused of allegedly cheating customers out of interest payments.
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US Consumer Financial Protection Bureau sued the major credit company over the alleged misgression. The government organization claims Capital One withheld payments to those who have its high interest savings account.
They allege Capital One withheld more than $2 billion in payments. You're talking about a lot of dough here — more than a bakery's worth. CFPB filed the suit in Alexandria, Virginia. The government entity alleges says that Capital One didn't follow through on its promises. Capital One promised accounts one of the "top" and "highest" interest rates. However, it froze rates at just 0.30% while the competition rose higher.
The organization says that Capital One then launched the 360 Performance Savings account in 2019. It carries a higher interest rate of 4.35%. However, they failed to notify those who had the original 360 Savings account. The two accounts are identical except the later carried a much higher interest rate.
Credit Card Company Sued
According to the lawsuit, the major credit card company told employees not to mention to customers that they could swap accounts unless asked.
"Banks should not be baiting people with promises they can't live up to," CFPB Director Rohit Chopra said in a statement.
According to CFPB, Capital One stopped offering the original 360 Savings after introducing the latter accounts. The lawsuit is seeking restitution as well as fines. The organization believes the credit card company violated the Consumer Financial Protection Act of 2010 andthe Truth in Savings Act.
"We are deeply disappointed to see the CFPB continue its recent pattern of filing eleventh-hour lawsuits ahead of a change in administration," Capital One said in a statement. "We strongly disagree with their claims and will vigorously defend ourselves in court."
The lawsuit will go to trial in July. It remains to be seen what happens in the case. But if you were one of the depositors then I'm sure you are watching the case with great interest. Hopefully, you put your money in an account with a higher yield.
