The Consumer Financial Protection Bureau announced Tuesday that it was suing Capital One for misleading consumers about their savings account interest rates and “cheating” them out of more than $2 billion in interest.

The agency said in a statement Capital One deceived holders of its “360 Savings” account by conflating it with its newer and higher-yield savings account option, the “360 Performance Savings” account. The bank allegedly failed to notify 360 Savings account holders of the newer option and marketed the two products similarly to lead customers to believe they were the same.

However, the interest rates of the two options were substantially different, according to the CFPB. Capital One increased the 360 Performance Savings interest rate from 0.4% in April 2022 to 4.35% in January 2024, while it lowered and then froze the 360 Savings rate at 0.3% between late 2019 to mid-2024, the agency said.

Despite its relatively low interest rate, the CFPB alleged, the 360 Savings account was advertised as a high-interest savings account. The bureau said Capital One aimed to keep 360 Savings users in the dark about the higher-yield option by replacing all references to the account with the similarly named 360 Performance Savings option on its website, excluding account holders from marketing campaigns advertising the higher-yield account and forbidding employees from notifying account holders about the 360 Performance Savings option.

“The CFPB is suing Capital One for cheating families out of billions of dollars on their savings accounts,” said CFPB Director Rohit Chopra in a news release. “Banks should not be baiting people with promises they can’t live up to.”

In a statement, Capital One denied the allegations and said it transparently marketed its 360 Performance Savings account.

“We are deeply disappointed to see the CFPB continue its recent pattern of filing eleventh hour lawsuits ahead of a change in administration. We strongly disagree with their claims and will vigorously defend ourselves in court,” the company said in a statement.

The bank added the 360 Performance Savings product was “marketed widely, including on national television, with the simplest and most transparent terms in the industry.”

JPMorgan Chase said Tuesday that Chief Operating Officer and President Daniel Pinto will step down from those roles in the coming months, elevating a potential successor to CEO Jamie Dimon to a key companywide role.

Pinto, who has worked at JPMorgan and a predecessor firm for more than four decades, will cease being COO and president in June and retire at the end of 2026, the bank said.

This story is developing. Please check back for updates.

Klarna has agreed a major new distribution partnership with fellow fintech unicorn Stripe, in a bid to expand reach and add more merchants in the lead-up to its upcoming listing in the U.S.

Klarna’s buy now, pay later (BNPL) service will become available as a payment option for merchants using Stripe’s payment tools in 26 countries, the two companies told CNBC Tuesday.

This isn’t the first time Klarna and Stripe have partnered. In 2021, at the height of the Covid-19 pandemic-fueled fintech craze, Stripe announced Klarna would offer its BNPL plans to the U.S. firm’s merchants.

BNPL plans are installment loans that allow a consumer to buy something online or in store and then pay off their debt, either at a later date or over a period of equal monthly installments. BNPL arrangements have become a popular way for people to spread the cost of everyday purchases.

The new tie-up with Stripe gives Klarna a big boost at a time when it’s gearing up for a hotly anticipated initial public offering. Klarna confidentially filed to IPO in the United States in November. The company could fetch a valuation of as much as $20 billion, according to a Bloomberg News report out last year.

Klarna makes money from the fees that retailers pay on each transaction processed through its platform. In return for giving Klarna visibility as a payment option in its checkout tools, Stripe will get a share of the money Klarna makes from a given transaction.

Klarna declined to disclose financial terms of its deal with Stripe.

“This is really significant for Klarna,” David Sykes, Klarna’s chief commercial officer, told CNBC, adding the company has already doubled the number of new merchants in the three months since it began implementing the new integration with Stripe in October.

“We added 100,000 new merchants in 2024 and we are already seeing that growth rate increase with this agreement.” he added.

Analysts recently valued Klarna, which was founded in 2005, in the $15 billion range. At its peak during the pandemic-led surge in fintech stocks, the company attracted a valuation of $46 billion in a funding round led by SoftBank’s Vision Fund 2 back in 2021.

In 2022, Klarna took an 85% haircut in a fresh round of funding that valued the firm at $6.7 billion.

The deal also has the potential to drive incremental revenue gains for Stripe, too.

BNPL proponents tout these plans as a way to increase the overall level of transactions, as shoppers can buy more items during a shorter term window and then pay them off over a longer timeframe.

A study Stripe ran last year found businesses offering BNPL as a payment method generated up to 14% more revenue from increased conversion and higher average order values.

“We’ve seen BNPL volume grow 172% last year on Stripe, which is much faster than other mainstream payment methods,” Jeanne Grosser, chief business officer of Stripe, told CNBC, adding that the deal with Klarna was a “win-win” for both firms.

Stripe has long been speculated to be a near-term IPO candidate — for its part, though, the company says it’s in no rush. The company, also a victim of a slump in fintech valuations, slashed its valuation to $50 billion in 2023 from $95 billion in 2021. The company’s valuation reportedly rebounded to $70 billion, as part of a secondary share sale.