Capital One Hid Better Rates From Millions of Customers

What Capital One Did

In 2019, as interest rates rose, Capital One faced a problem. Their popular 360 Savings account was paying just 0.30% APY while competitors offered 4%+. Customers were leaving.

Capital One's solution? Create a new account called "360 Performance Savings" paying 4.35% APY—but don't tell existing 360 Savings customers about it.

The two accounts were virtually identical:

• Same $0 minimum balance
• Same $0 monthly fees
• Same FDIC insurance
• Same online/mobile access

The only difference? The interest rate. And Capital One's explicit policy that employees were forbidden from mentioning the better account to existing customers.

The Smoking Gun

According to the CFPB lawsuit, Capital One's internal communications showed:

"Customer service representatives were explicitly instructed not to proactively inform 360 Savings customers about the existence of 360 Performance Savings or the significant rate difference between the two products."

Even when customers called to complain about low rates, employees were trained to:

1. Acknowledge the concern
2. Explain that rates vary
3. Not mention that a better option existed

This wasn't a mistake or oversight. It was deliberate corporate policy to maximize profits at customers' expense.

How Much Did Customers Lose?

Let's do the math on a $25,000 balance over 5 years:

A customer with $25,000 lost over $5,500 in interest because Capital One hid the better option. Multiply that across millions of customers, and you understand why the settlement is $425 million.

The Settlement

The CFPB's enforcement action resulted in:

• $425 million in refunds to affected customers
• Capital One must automatically move eligible customers to higher-rate accounts
• New disclosure requirements
• Ongoing monitoring by regulators

How to Check If You're Affected

Is Your Bank Doing This Too?

Capital One got caught, but they're not the only bank playing this game. Here's how to audit your own accounts:

Step 1: Check Your Current Rate

Log into your savings account. What APY are you actually earning? Not the promotional rate—the current, actual rate.

Step 2: Compare to Market Rates

Top high-yield savings accounts currently pay 3.65-4.00% APY. If you're earning less than 3%, you're leaving money on the table.

Step 3: Check for Hidden Products

Search your bank's website for all savings products. Do they offer a "premium," "performance," or "high-yield" version? Compare the rates to what you have.

Step 4: Call and Ask

Directly ask: "Do you have any savings accounts with higher rates than what I currently have?" Banks can't lie if you ask directly—but they might not volunteer the information.

The Bigger Lesson

Capital One's scheme reveals an uncomfortable truth: banks are not looking out for you.

Their job is to maximize profits. Your job is to make them compete for your business.

The best defense against rate manipulation:

1. Compare rates annually — Set a calendar reminder to check competitor rates
2. Be willing to switch — Bank loyalty costs money; switching is free
3. Use comparison sites — That's why we exist
4. Automate rate alerts — Some banks notify you of rate changes; demand this feature

Where to Move Your Money

If you're still at Capital One earning sub-market rates, here are better options:

The Bottom Line

Capital One deliberately hid a better product from millions of customers to boost profits. They got caught, and now they're paying $425 million.

But this story isn't really about Capital One. It's about the importance of being an informed consumer:

• Never assume your bank has your best interest in mind
• Compare rates regularly
• Ask questions—banks won't volunteer information
• Switch when better options exist

Your bank loyalty isn't rewarded. Your willingness to leave is.