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The CFPB will no longer pursue legal action against Capital One, according to a court filing on Thursday, Feb. 27. The case, filed in January, claimed the banking giant misled customers and withheld more than $2 billion in interest payments.
The company based in McLean, Virginia, supported the dismissal.
"We welcome the CFPB's decision to dismiss this action, which we strongly disputed," a Capital One spokesperson said in a statement to the Daily Voice.
Capital One was accused of keeping customers in lower-yielding "360 Savings" accounts while offering new customers a nearly identical product with significantly higher interest rates called "360 Performance Savings." The CFPB claimed Capital One deliberately kept existing customers unaware of the higher-yielding account.
Former CFPB director Rohit Chopra said Capital One cheated families out of "billions of dollars."
"Banks should not be baiting people with promises they can't live up to," he said when the suit was first announced.
The suit was dismissed without explanation, marking another step in a broader effort by President Donald Trump's administration to scale back consumer protection enforcement. On the same day, the CFPB also dismissed a lawsuit against the Pennsylvania Higher Education Assistance Agency, which was accused of illegally collecting payments on loans discharged in bankruptcy, NBC News reported.
The CFPB also dropped a case against SoLo Funds, an online lender it had previously claimed misled borrowers about loan costs. Jonathan McKernan, Trump's nominee to lead the CFPB, told a Senate committee on February 27 that the agency had "overstepped the bounds of its mandate" and should be more "streamlined and accountable."
McKernan's nomination comes as the Trump administration moves to gut federal agencies, a push led by billionaire Elon Musk. The de facto head of the Department of Government Efficiency has previously expressed his desire to "delete" the CFPB, which was created in 2011 after the global financial crisis.
Earlier in February, a judge temporarily blocked mass firings at the CFPB, adding that data housed by the independent agency can't be deleted.
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