A federal judge approved a revised $425M deal that pays more and raises interest rates too.
A long legal fight finally reaches its end
Millions of current and former Capital One customers are about to receive settlement checks after a federal judge finalized a $425 million agreement on Monday. The deal resolves nearly two years of litigation over the bank’s handling of two similarly named savings accounts that paid dramatically different interest rates while keeping customers largely in the dark about the difference.
Judge David Novak of the Eastern District of Virginia approved the revised settlement, closing a case that had already survived one rejection. Novak had refused to sign off on an earlier agreement in November 2025, saying it did not fairly compensate account holders and that the bank had continued to obscure the gap between its two products.
What Capital One actually did
The lawsuit centers on two accounts: the 360 Savings account and the 360 Performance Savings account. When the Performance Savings account launched in 2019, both products offered relatively comparable rates, with Performance Savings at 1.9% and the older 360 Savings at 1%. Over time, those rates moved in opposite directions. The older account’s rate dropped to 0.3% annual percentage yield while the newer account climbed as high as 4.35% APY.
Customers who held the 360 Savings account were not clearly informed that they were sitting in a product paying a fraction of what Capital One was offering through a nearly identical account. The bank was also accused of taking active steps to prevent customers from making the switch. An email Capital One presented as evidence of its outreach efforts was described by Novak as reading more like a marketing pitch than a genuine notification to existing savers.
According to court documents, about three-fourths of affected customers still hold the lower-paying account.
Why the first settlement was rejected
The initial deal, also priced at $425 million, allocated $300 million for direct payments to account holders and set aside $125 million to raise interest rates for customers still holding the old savings account. Novak rejected it, saying the payout covered less than 10% of the interest customers had actually lost and that the bank had not done enough to inform savers they had options.
Attorneys general from 18 states filed objections to the first deal, including New York Attorney General Letitia James, who had brought her own parallel lawsuit on behalf of New York customers. Legal experts noted that the volume of official opposition almost certainly contributed to the judge’s decision to take a harder look at the terms.
What the new deal means for customers
The revised settlement redirects the full $425 million toward direct compensation for account holders, rather than splitting the pot between restitution and rate adjustments. On top of that, Capital One is now required to raise the interest rate on its 360 Savings account to match the yield on the 360 Performance Savings account. That means customers who never switched and never knew they could will still benefit without having to take any action.
Customers who held a Capital One 360 Savings account at any point between Sept. 18, 2019, and June 16, 2025, are eligible for payments. The amount each person receives will depend on how long they held the account, how much money they kept in it, and how many total customers are sharing the settlement pool. Eligible customers do not need to file a claim or do anything to receive their payment. Checks are expected to begin going out within the next month or two.
James and other state attorneys general agreed to drop their separate lawsuits as part of the finalized deal.
The Consumer Financial Protection Bureau had also sued Capital One over its savings products in January 2025, but that case was dropped following a leadership change at the agency after President Donald Trump returned to office.