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US financial giant Capital One will hand $425 million to customers in a massive class action settlement.
Account holders accused the bank of purposefully blocking them from accessing higher interest rates in their savings accounts.
Specifically, the bank is accused of misleading clients by not telling them about higher-yielding 360 Performance Savings accounts.
This allegedly prevented customers from accessing better interest rates, keeping their 360 Savings account rates as low as 0.3%.
The settlement, first reported by Reuters, will require a judge’s approval.
It allocates $300 million to compensate depositors for interest they could have earned on 360 Performance Savings accounts, which offered rates up to 4.35% last year.
The remaining $125 million will provide additional interest to depositors who currently hold 360 Savings accounts, addressing the lower rates they received.
The agreement, filed in federal court in Alexandria, Virginia, covers customers with 360 Savings accounts since September 18, 2019.
Capital One, based in McLean, Virginia, did not admit wrongdoing and has not released a statement on the settlement at time of publishing.
