Millions of current and former Capital One customers are in store for payouts after a federal judge gave a $425 million settlement the final green light this week.
Judge David Novak of the US Eastern District of Virginia on Monday finalized an agreement with the bank to settle accusations it steered customers away from accounts that paid much higher interest.
The lawsuit has been playing out in court for nearly two years, and Novak had rejected an initial settlement last November for not fairly compensating account holders.
Capital One has agreed to pay $425 million to settle accusations it created two savings accounts with very similar names – 360 Savings and 360 Performance Savings – that paid vastly different interest rates, without making the difference clear to customers.
That left customers unsure of which account they held, causing them to lose out on millions of dollars in interest payments, according to legal documents.
Customers who held a Capital One 360 Savings account at any time between Sept. 18, 2019, and June 16, 2025, are eligible for settlement payments.
Payment amounts will vary based on how long you held your account, how much money you had in the account and how many customers are ultimately included in the class.
Eligible former and current customers should start receiving their payments within the next month or two without taking any action.
According to the lawsuit, the 360 Performance Savings account launched in 2019 with a 1.9% interest rate – not so far off from the original 360 Savings’ 1% yield.
But those rates changed drastically, as 360 Savings’ rate plummeted to a 0.3% annual percentage yield while the new 360 Performance Savings jumped as high as 4.35%, according to the suit.
The bank was also accused of trying to make sure customers didn’t know they could be earning higher interest simply by switching to a new account.
Capital One’s initial settlement was rejected for not paying customers even restitution to make up for the lost interest, and for not making it clear to current account holders that they could make a switch for higher interest.
About three-fourths of affected customers are still holding the lower-paying account, according to court documents.
The new settlement deal forces the bank to raise the interest rate on its 360 Savings Account to match the yield on its 360 Performance account, so customers unaware of the other option will still reap the benefits.
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