Capital One Sweetens Settlement Deal – Will You Get More Money?

Capital One has amended its $425 million settlement agreement following a November rejection by a federal judge who deemed the initial payout insufficient and the customer notification inadequate. The revised deal aims to better compensate affected 360 Savings customers for lost interest and will also increase the interest rate on existing 360 Savings accounts to match the 360 Performance account. The original lawsuit accused Capital One of misleading customers with similarly named accounts offering significantly different interest rates.

The court initially expressed concern that many customers were unaware of the lower interest rates they were receiving and that Capital One hadn't adequately informed them about the option to switch to higher-yielding accounts. The amended agreement addresses this by raising the interest rate for all 360 Savings account holders without requiring them to take action. Attorneys general from multiple states, including New York, initially objected to the first deal but have agreed to drop their lawsuits if the revised settlement is approved.

A final approval hearing is scheduled for April 20, with payouts expected to begin in the following months. The settlement stems from allegations that Capital One failed to clearly communicate the differences between the 360 Savings and 360 Performance Savings accounts, resulting in customers missing out on potentially millions in interest earnings. Capital One has also faced separate lawsuits from the Consumer Financial Protection Bureau and the New York Attorney General regarding these savings products.

(Source：Usnews)