February 19, 2010 / 12:42 AM / 8 years ago

UPDATE 1-Capital One to reimburse customers $775,000

(Updates to include number of customers receiving reimbursements)

WASHINGTON, Feb 18 (Reuters) - Capital One Financial Corp (COF.N) will reimburse about $775,000 to customers following an agreement with U.S. bank regulators over complaints of credit card account closing practices.

The practices occurred from 2004 through 2006 and involved annual membership fees, the Office of the Comptroller of the Currency said on Thursday.

Capital One charged the fees on accounts with no outstanding balances after consumers had asked the bank to close the accounts, the agency said.

Capital One expanded its reimbursement beyond practices flagged by the OCC to include customers who paid off accounts within 90 days after requesting that the accounts be closed.

“This problem was the result of a systems issue that we fixed in 2006,” Capital One said in a statement. “At the time, we refunded membership fees for many customers who contacted us directly but, in retrospect, we should have done so for an additional 3,400 customers, as well. We sincerely regret this error.”

The OCC said Capital One voluntarily entered into the agreement. Capital One will distribute the $775,000 to more than 18,000 customers. (Reporting by Karey Wutkowski; Editing by Robert MacMillan and Steve Orlofsky)

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