Nothing lasts forever, sometimes not even two months. The Consumer Financial Protection Bureau (CFPB) has officially dropped its lawsuit against Capital One (COF) less than two months after accusing the bank of misleading customers and withholding higher interest rates. The sudden reversal, filed on February 27, 2025, means the case is permanently closed. Capital One quickly welcomed the news, saying it had always disputed the claims.
The bank said in a statement, “We are pleased with the CFPB’s decision. We have always been transparent with our customers and remain committed to fair banking.”
Why the Lawsuit in the First Place?
Initially filed in January, the lawsuit accused Capital One of misleading customers about its 360 Savings accounts. The bank allegedly promoted these accounts as having top-tier interest rates while secretly offering a separate, better-paying option, the 360 Performance Savings account. The CFPB argued that customers lost more than $2 billion in interest because the bank did not inform them about the better deal.
However, this case didn’t just vanish on its own. The CFPB has seen big changes since Donald Trump returned to the White House. After the inauguration, former director Rohit Chopra was replaced, first by Scott Bessent and later by Russell Vought. The new leadership wasted no time reshaping the agency. Vought quickly froze investigations, cut funding, and dropped several lawsuits – including this one against Capital One. The move signals a major shift in how the CFPB operates under the new administration.
Meanwhile, Capital One is eyeing an even bigger prize: finalizing its $35 billion merger with Discover (DFS). If approved, the deal would make Capital One the biggest credit card company in the U.S. With the CFPB off its back, the bank can now focus on making that deal happen.
Is Capital One Stock a Good Buy?
Turning to Wall Street, Capital One is considered a Moderate Buy based on 16 analysts’ ratings. The average price target for COF stock is $215, implying a 26.14% upside potential.
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