The long-standing savings account lawsuit against Capital One has taken a significant turn as a federal judge rejected the initial settlement, urging both parties to renegotiate the terms. This legal battle affects millions of customers who held Capital One 360 Savings accounts during a time of rising interest rates across the country.
The heart of the dispute lies in whether customers received fair compensation for their funds in accounts that offered considerably lower interest rates compared to similar savings products. While Capital One rolled out a higher-yield option, many longtime customers stuck with their lower-interest accounts for years.
A new settlement proposal, crafted in response to the court’s concerns, is now under review. If given the green light, it would revise both the compensation structure and the way interest rates are handled moving forward.
Why the Original Settlement Was Rejected
On November 6, 2025, during a court hearing, the judge opted not to approve the initial settlement agreement. The ruling was based on the finding that the proposal did not adequately compensate customers who lost out on earning potential interest over a lengthy period.
The original deal included $300 million in direct payments and an additional $125 million earmarked for future interest benefits for account holders. However, the judge deemed this approach uneven and confusing, especially for those whose benefits hinged on the status of their accounts.
Rather than concluding the case, the judge encouraged both sides to create a more equitable and clear agreement, resulting in a revised settlement proposal.
Changes in the Revised Settlement Plan
The updated settlement simplifies how compensation will be delivered. Instead of dividing the funds between cash payments and future interest benefits, Capital One will distribute the entire $425 million directly to eligible class members once the settlement is finalized.
Moreover, Capital One has committed to matching and linking the interest rates on 360 Savings accounts to those of 360 Performance Savings accounts for a minimum of two years. This change aims to ensure that existing customers do not earn lower returns than new account holders.
These adjustments address the court’s concerns by providing immediate compensation and stronger protections for the future.
Original vs. Revised Settlement Structure
| Category | Original Proposal | Revised Proposal |
|---|---|---|
| Total Settlement Value | $425 million | $425 million |
| Direct Payments | $300 million | $425 million |
| Future Interest Fund | $125 million | Removed |
| Interest Rate Treatment | Separate account rates | Rates matched for 2 years |
| Court Status | Rejected | Pending approval |
The revised plan eliminates uncertainty regarding future benefits and guarantees equal treatment of savings accounts for a set timeframe.
Who is expected to be eligible?
The eligibility criteria are likely to stay largely the same in the revised settlement. Customers will be included based on account records rather than needing to file individual claims.
Eligible customers typically include those who:
- Had a Capital One 360 Savings account during the designated period starting in 2019.
- Kept their accounts open or had them closed by the relevant cutoff date.
- Are identified using Capital One’s internal account data.
If the settlement receives preliminary approval, updated notices will be sent to class members to outline the next steps.
How Payments and Interest Adjustments Would Work
Upon approval of the revised settlement, eligible customers will receive one-off cash payments from the $425 million settlement fund. The payment amounts will vary based on factors like the average account balance and how long money was held in the account during the eligible timeframe.
For customers who continue with their 360 Savings accounts, interest rates will automatically align with those on 360 Performance Savings accounts for at least two years—no action needed on their part.
All payments and interest adjustments will only become effective following final court approval and administrative processing.
Updated Court Schedule and Important Dates
The court has scheduled several hearings to review the revised settlement and associated notices.
Key dates currently on the calendar include:
- January 12, 2026 – Hearing to consider new notice to class members and preliminary approval.
- April 20, 2026 – Final approval hearing for the revised settlement.
- Additional procedural deadlines – Detailed in the judge’s official scheduling order.
Keep in mind these dates may shift based on court decisions or objections during the review process.
Review by State Attorneys General
A group of state attorneys general is currently reviewing the revised settlement, assessing whether its updated terms better reflect the financial impact on customers.
Previous objections raised concerns that the original settlement allowed the bank to evade full responsibility. It’s anticipated that the bigger direct payment pool and mandatory interest rate alignment will address many of those worries, but final positions are yet to be disclosed.
The court’s ultimate decision will take into account feedback from regulators, class members, and settlement administrators.
What Customers Should Do Now
At this point, no payments have been made, and no final settlement has been approved. Customers should stay updated on official settlement announcements and court-approved communications, particularly after the January 2026 hearing.
Until a final ruling is issued by the court, customers should remain vigilant against unofficial emails or messages that claim to offer early payments or settlement assistance.
Frequently Asked Questions:
1. Has the Capital One settlement been finalized?
No. The original settlement was rejected, and a revised settlement is currently under review. Final approval is set for April 2026.
2. Will customers need to file a claim to receive payment?
As it stands, payments are expected to be automatically issued to eligible customers based on account records, but updated instructions will be given if the settlement is approved.