Gothamist
A non-profit newsroom, powered by WNYC.
Gothamist
Listen Live
News
AG James says Capital One cheated New Yorkers out of millions of dollars
By
Samir Ferdowsi
Published May 14, 2025
Modified May 14, 2025
Share
FacebookTwitterRedditEmail
Never miss a story
Email address
By submitting your information, you're agreeing to receive communications from New York Public Radio in accordance with our Terms .
Alexi Rosenfeld/Getty Images
By
Samir Ferdowsi
Published May 14, 2025
Modified May 14, 2025
Share
FacebookTwitterRedditEmail
We rely on your support to make local news available to all
Make your contribution now and help Gothamist thrive in 2026. Donate today
Gothamist is funded by sponsors and member donations
New York is suing the banking giant Capital One over what the state is calling bait-and-switch messaging that ultimately cost New Yorkers millions of dollars.
Attorney General Letitia James alleges that the bank misled customers by promising that those who opened its 360 Savings accounts would be putting their money in a high-yield savings account. But in the lawsuit filed Wednesday, James says that wasn’t the case — that Capital One kept those accounts’ interest rates artificially low, yet in 2019 began offering a similarly named 360 Performance Savings Account that at one point offered rates 14 times higher than the original 360 Savings version.
“Capital One created confusion so that 360 Savings customers wouldn’t realize that their accounts were obsolete and wouldn’t know that they had to open new 360 Performance Savings accounts to receive the rates advertised on Capital One’s website going forward,” the lawsuit alleges.
The allegations mirror those in a lawsuit the federal Consumer Financial Protection Bureau filed in the last days of the Biden administration in January, but that the agency dropped after President Donald Trump took office. James said in an announcement Wednesday New York filed suit to ‘ensure that Capital One does not escape accountability” and to seek restitution “for all affected Capital One customers.”
“New York families work hard to save money for their futures, and they deserve every dollar of interest they are promised,” James said in a statement “Capital One assured high returns with no catches, then pulled the rug out from under their customers and hoped nobody would notice. Big banks are not allowed to cheat their customers with false advertising and misleading promises.”
A spokesperson for Capital One told Gothamist in a statement it disputes the AG's claims, and that it's proud of its full suite of 360 banking products.
According to the lawsuit, the bank claimed that its 360 Savings account had “one of the nation’s best savings rates” and that “your money will earn much more than what it would in an average savings or money market account.” It cites Capital One materials telling consumers “What’s the catch? There is none.”
But, according to James' office, there was a catch: that while the Performance accounts followed national trends that saw interest rates rising, the original 360 Savings accounts stayed with locked-down low rates.
It said both accounts were low as the Fed cut interest rates nationally to near 0% near the start of the coronavirus pandemic in 2020 — with 360 Savings at .3% and the Performance accounts at .4%. But national interest rates eventually bounced back. The lawsuit describes the Performance accounts rising to 3.30% in January 2023 and to a high of 4.35% in January 2024 — but the original 360 Savings accounts staying frozen at .3%.
The lawsuit alleges the bank kept customers in the dark about the changes, quoting “talking points” saying that because the Fed’s rates were increasing, “we’ve adjusted our deposit account rates, just like many other banks and financial institutions.” It says Capital One completely removed all messaging about the original 360 accounts from the website.
According to James’ office, the allegedly misleading tactics mean that customers banking with Capital One for years may be out large sums of money.
“A customer who put $10,000 in a 360 Savings account in September 2019 would have earned $186 of interest after five years,” the lawsuit explains “If the same customer had switched to a 360 Performance Savings account, they would have earned $1,090 of interest over the same period.”
James’ office said New Yorkers collectively lost out on millions of dollars “while Capital One pocketed the difference.”
This story has been updated with more information.
Tagged
new york city
public safety
Workforce
economy
Politics
Samir Ferdowsi
Samir is a day-of reporter on the general assignment and breaking news desk. Previously Samir was a reporter, host and producer at VICE News.
Read more
Gothamist is funded by sponsors and member donations
Gothamist is funded by sponsors and member donations
MORE news
At least one tornado hits NY, damaging Long Island surf clubs
The confirmed tornado touched down in Atlantic Beach. Another may have hit about a mile away.
By
Brittany Kriegstein
Published Aug 21, 2026 at 9:36 a.m. ET
Meet Mamdani's arts commissioner, who wants to keep NYC's culture scene affordable
Diya Vij was appointed to lead New York City’s Department of Cultural Affairs six months ago.
By
Sonia Rao
News
Meet Mamdani's arts commissioner, who wants to keep NYC's culture scene affordable
Diya Vij was appointed to lead New York City’s Department of Cultural Affairs six months ago.
By
Sonia Rao
NYPD is looking for the driver of a BMW who struck and killed a cyclist in Brooklyn
By
Brittany Kriegstein
Make classrooms analog again? A new bill aims to limit tech in schools.
By
Jessica Gould
NYPD crackdown on illegal e-bikes ramps up under Mamdani
By
Elizabeth Kim
Never miss a story
Catch up on the most important headlines with a roundup of essential NYC stories, delivered to your inbox daily.
Sign upEmail address
By submitting your information, you're agreeing to receive communications from New York Public Radio in accordance with our Terms .