On Thursday, the Consumer Financial Protection Bureau (CFPB) announced the dismissal of its lawsuit filed on January 14, 2025, against Capital One and its parent company, Capital One Financial Corp. The lawsuit accused the bank of deceiving millions of consumers out of over $2 billion in savings account interest.
Originally filed just ten days prior to President Trump’s inauguration, the lawsuit claimed that Capital One misled customers by maintaining low interest rates on its 360 Savings accounts while inadequately informing account holders about the higher-yielding 360 Performance Savings account.
In addition, the CFPB also withdrew its lawsuits against Rocket Homes and Vanderbilt Mortgage and Finance on the same day. These legal actions, including the one against Capital One, were initiated under the leadership of former CFPB director Rohit Chopra, who was terminated by Trump two weeks after Inauguration Day.
The Future of the CFPB
A court filing dated February 27 revealed that the CFPB voluntarily dismissed the Capital One case, occurring shortly after the Trump administration took steps to curtail the agency’s operations significantly.
Jonathan McKernan, a former member of the Federal Deposit Insurance Corporation (FDIC) board and Trump’s nominee for the CFPB’s permanent leadership position, provided testimony during his Senate confirmation hearing on Thursday. A federal court motion submitted on February 24 indicated that the Trump administration intends to continue the CFPB’s operations, though with a more streamlined approach.
Established in 2011 under the Dodd-Frank Act, the CFPB has a history of penalizing banks for unethical practices, including the unauthorized creation of bank accounts and the imposition of excessive overdraft fees.
As an independent government agency dedicated to consumer protection in the financial sector, some notable actions taken by the CFPB include:
- 2024: Filing a lawsuit against Early Warning Services, Bank of America, Wells Fargo, and Chase for allegedly failing to safeguard the Zelle network from fraud, resulting in significant consumer losses.
- 2024: Ordering Navy Federal Credit Union to pay $95 million in refunds and fines related to overdraft fees.
- 2022: Enforcing a payment of $3.7 billion in compensation and penalties from Wells Fargo due to overdraft fees and interest charges on loans.