By Katherine Hamilton

Capital One was hit with a lawsuit from the New York Attorney General for how it sets rates on some of its savings accounts.

Attorney General Letitia James on Wednesday alleged Capital One kept interest rates artificially low for its 360 Savings accounts, despite touting one of the best rates in the country.

As interest rates began to rise in 2022, Capital One froze its 360 Savings rate at 0.3%, which was below the average interest rate, James claimed.

James also alleged the bank's 360 Performance Savings was nearly identical to 360 Savings, but offered a much higher rate, sometimes by as much as 14 times. The lawsuit claims Capital One did not advertise the account with better rates.

"Capital One created a secret, two-tier system of savings accounts in which only new accounts received the high interest rates that Capital One advertised," James said.

Write to Katherine Hamilton at katherine.hamilton@wsj.com

(END) Dow Jones Newswires

May 14, 2025 12:09 ET (16:09 GMT)

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