NEW YORK — Capital One Financial Corp. is reimbursing about 18,000 customers $775,000 for annual credit-card membership fees after a regulator deemed some of them unfair.

The Office of the Comptroller of the Currency, in cooperation with the attorney generals of California and West Virginia, found that Capital One unfairly charged 3,400 customers annual fees totaling about $125,000 after those people, who carried no balance, had already requested their accounts be closed. The fees were charged between 2004 and 2006, when the bank fixed the problem.

Capital One agreed and voluntarily expanded the refund to an additional 15,000 customers who closed their accounts and paid their balances within 90 days. For those customers, the fee was "not found to be unfair," the OCC said.

"We sincerely regret this error," a Capital One spokeswoman said in a statement. The problem was the result of technical problem, and was fixed when Capital One converted its transaction processing system four years ago, she said.

Accounts of customers who request they be closed remain open for one billing cycle to allow potential charges to accumulate. For some customers their annual fee falls into that last billing period. Capital One reimbursed customers who complained about the fee, but failed to inform and reimburse those who simply paid it.

"In retrospect, we should have done so," the spokeswoman said about proactively reimbursing all customers affected. "As part of the resolution to this issue, we are going beyond the legal requirements" to refund membership fees. Capital One is now tracking the customers who paid the fee.

Annual fees had become rare until President Barack Obama targeted card companies, arguing that interest-rate and other practices were harmful to many customers. New legislation will go into effect on Monday. Now some card issuers are mulling charging annual fees again and evening out interest payments among different kinds of customers.

However, regulators and attorneys general have taken broader aim at banks' fees. This month, New York Attorney General Andrew Cuomo forced Citigroup Inc.'s retail bank to postpone charging a fee for checking accounts that so far had been free, because he said Citibank hadn't given enough clear notice. Banks face broad restrictions on overdraft fees.

Capital One was one of the nation's largest monoline credit card lenders until it expanded into banking. It is now regulated by the OCC; it wasn't during the period in question. Capital One, the eighth-largest bank by deposits, curbed card lending sharply early in the financial crisis and made it through the credit crunch in considerably better shape than other banks despite its sizable portfolio of nonprime card loans.

Capital One — with $90 billion of loans and $116 billion of deposits — generated a $312 million profit in 2009, compared with a $79 million loss in 2008.

In recent trading, the bank's shares were up 1.1% at $37.25.

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