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Banks (Finance)

New York Sues Capital One Over Alleged Bait-And-Switch Tactics

Strategic Insights

— 2 min read

New York Attorney General Letitia James has filed a lawsuit against Capital One, alleging that the bank engaged in deceptive marketing practices, ultimately costing New Yorkers millions of dollars. The lawsuit claims that Capital One misled customers by promising high-yield savings accounts, but instead kept interest rates artificially low. The bank allegedly created confusion by promoting a similar account with much higher interest rates, leaving customers in the dark about the changes.

Key Takeaways:

  • The lawsuit alleges that Capital One engaged in bait-and-switch tactics by promoting a 360 Savings account with low interest rates while offering a similar account, the 360 Performance Savings Account, with significantly higher interest rates.
  • The 360 Performance Savings Account offered rates 14 times higher than the original 360 Savings account at one point, with rates reaching 4.35% in January 2024.
  • The bank allegedly kept customers in the dark about the changes, removing all messaging about the original 360 accounts from the website and using talking points to downplay the significance of the rate increases.
  • A customer who put $10,000 in a 360 Savings account in September 2019 would have earned $186 of interest after five years, while they would have earned $1,090 of interest if they had switched to a 360 Performance Savings account.
  • New Yorkers collectively lost out on millions of dollars while Capital One pocketed the difference, according to Attorney General James' office.

Statistics:

  • 14: The number of times higher the interest rates of the 360 Performance Savings Account were compared to the original 360 Savings account at one point.
  • 3.30%: The interest rate of the 360 Performance Savings Account in January 2023.
  • 4.35%: The highest interest rate of the 360 Performance Savings Account, reached in January 2024.
  • $186: The amount of interest a customer would have earned by putting $10,000 in a 360 Savings account in September 2019 after five years.
  • $1,090: The amount of interest a customer would have earned by switching to a 360 Performance Savings account in September 2019.
  • Millions: The amount of dollars lost by New Yorkers due to Capital One's alleged deceptive marketing practices.

Sources:

  • New York State Office of the Attorney General. (2023, n.d.). State of New York v. Capital One, N.A. and Capitol One Financial Corporation. Retrieved from [https://ag.ny.gov/sites/default/files/court-filings/state-of-new-york-v-capital-one-n.a-and-capitol-one-financial-corporation-complaint-2025.pdf](https://ag.ny.gov/sites/default/files/court-filings/state-of-new-york-v-capital-one-n.a-and-capitol-one-financial-corporation-complaint-2025.pdf)
  • NBC News. (2023, January 30). CFPB drops suit accusing Capital One of cheating customers $2 billion. Retrieved from [https://www.nbcnews.com/business/consumer/cfpb-drops-suit-accusing-capital-one-cheating-customers-2-billion-rcna194050](https://www.nbcnews.com/business/consumer/cfpb-drops-suit-accusing-capital-one-cheating-customers-2-billion-rcna194050)

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