» Why did they settle? Well, to put it simply, it was starting to turn into a PR crisis. While they disagreed with the state of New York’s portrayal of the situation, the regulatory body had some pretty decent ammo against the bank, including an exec saying this: ”You (expletive) Americans. Who are you to tell us, the rest of the world, that we’re not going to deal with Iranians.” (There are U.S. sanctions on Iran.) The bank will take corrective measures to prevent this from happening again. (EDIT: As the WSJ’s Samuel Rubenfeld points out below, the deal does not preclude a settlement from federal regulatory bodies. That’ll happen separately.)
» What this means for consumers: This settlement isn’t simply something that affects Capital One’s customers — rather, it helps set some guidelines for the entire industry, by forcing stronger warnings on add-on services sold by credit card companies; by setting a standard for clear payouts of refunds to consumers; and by discouraging other companies from selling the programs, which many consumer advocates dismiss as “junk products.” Simply put, the Capital One settlement sets a future standard for the financial industry as they work with the CFPB.