<SEC-DOCUMENT>0001193125-24-211894.txt : 20250219
<SEC-HEADER>0001193125-24-211894.hdr.sgml : 20250219
<ACCEPTANCE-DATETIME>20240903131058
<PRIVATE-TO-PUBLIC>
ACCESSION NUMBER:		0001193125-24-211894
CONFORMED SUBMISSION TYPE:	CORRESP
PUBLIC DOCUMENT COUNT:		2
FILED AS OF DATE:		20240903

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CAPITAL ONE FINANCIAL CORP
		CENTRAL INDEX KEY:			0000927628
		STANDARD INDUSTRIAL CLASSIFICATION:	NATIONAL COMMERCIAL BANKS [6021]
		ORGANIZATION NAME:           	02 Finance
		IRS NUMBER:				541719854
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		CORRESP

	BUSINESS ADDRESS:	
		STREET 1:		1680 CAPITAL ONE DRIVE
		STREET 2:		SUITE 1400
		CITY:			MCLEAN
		STATE:			VA
		ZIP:			22102
		BUSINESS PHONE:		7037201000

	MAIL ADDRESS:	
		STREET 1:		1680 CAPITAL ONE DRIVE
		STREET 2:		SUITE 1400
		CITY:			MCLEAN
		STATE:			VA
		ZIP:			22102

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	OAKSTONE FINANCIAL CORP
		DATE OF NAME CHANGE:	19940728
</SEC-HEADER>
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<TYPE>CORRESP
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<Center><DIV STYLE="width:8.5in" align="left">
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[Letterhead of Wachtell, Lipton, Rosen&nbsp;&amp; Katz] </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">September&nbsp;3, 2024 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>CONFIDENTIAL
TREATMENT REQUESTED PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </U></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTIONS
OF THIS LETTER. INFORMATION THAT WAS OMITTED IN THE EDGAR VERSION HAS BEEN NOTED IN THIS LETTER WITH A PLACEHOLDER IDENTIFIED BY THE MARK &#147;[***]&#148;. </U></P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>VIA EDGAR </U></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">U.S. Securities and Exchange Commission </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Division of Corporation Finance </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">100 F Street, NE </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Washington, D.C. 20549 </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD VALIGN="top">Attention:&#8195;</TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Michael Henderson</TD></TR>
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<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Amit Pande</TD></TR>
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<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Robert Arzonetti</TD></TR>
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<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top">Christian Windsor</TD></TR>
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<TD VALIGN="top"><B>Re:&#8195;&#8195;</B></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top"><B>Capital One Financial Corporation</B></TD></TR>
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<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top"><B>Amendment No.&nbsp;2 to Registration Statement on Form <FONT STYLE="white-space:nowrap">S-4</FONT></B></TD></TR>
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<TD VALIGN="top"></TD>
<TD VALIGN="bottom">&nbsp;</TD>
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<TD VALIGN="bottom">&nbsp;&nbsp;</TD>
<TD VALIGN="top"><B>Filed July&nbsp;26, 2024</B></TD></TR>
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<TD VALIGN="top"><B>File <FONT STYLE="white-space:nowrap">No.&nbsp;333-278812</FONT></B></TD></TR>
</TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Dear Messrs. Henderson, Pande, Arzonetti and Windsor: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:9%; font-size:10pt; font-family:Times New Roman">On behalf of our client, Capital One Financial Corporation (&#147;<U>Capital One</U>&#148;), we are providing the responses set forth below to
the comments of the Staff (the &#147;<U>Staff</U>&#148;) of the Division of Corporation Finance (the &#147;<U>Division</U>&#148;) of the U.S. Securities and Exchange Commission (the &#147;<U>SEC</U>&#148;) set forth in its letter, dated
August&nbsp;6, 2024, with respect to the above-referenced Amendment No.&nbsp;2 to the Registration Statement on Form <FONT STYLE="white-space:nowrap">S-4</FONT> (the &#147;<U>Registration Statement</U>&#148;). </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:9%; font-size:10pt; font-family:Times New Roman">Pursuant to 17 C.F.R. &#167; 200.83 (&#147;<U>Rule 83</U>&#148;), confidential treatment is being requested with respect to the portions of
the responses to Staff comments 1 through 4 that have been redacted from the version of this letter filed via the SEC&#146;s EDGAR system and marked by bracketed asterisks (&#147;[***]&#148;). An unredacted version of this letter is being provided
to the SEC under separate cover along with the request for confidential treatment under Rule 83. A separate letter is also being filed with the Office of Freedom of Information and Privacy Act in connection with the confidential treatment request
pursuant to Rule 83. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:9%; font-size:10pt; font-family:Times New Roman">For the Staff&#146;s convenience, the text of the Staff&#146;s comments is set forth below in bold, followed in each
case by the response. Terms not otherwise defined in this letter shall have the meanings set forth in the Registration Statement. </P> <P STYLE="font-size:18pt; margin-top:0pt; margin-bottom:0pt">&nbsp;</P>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT REQUESTED PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P>
<P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P> <P STYLE="margin-top:0pt;margin-bottom:0pt">


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 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">U.S. Securities and Exchange Commission </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">September&nbsp;3, 2024 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"> Page
 2
 </P> <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Amendment No.&nbsp;2 to Registration Statement on Form <FONT STYLE="white-space:nowrap">S-4</FONT>
</U></B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Recent Developments </U></B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Discover
Card Misclassification, page 17 </U></B></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>1.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Please provide a more detailed explanation of the card product misclassification matter, including the
cause, when it was first identified in the organization, how it was identified, and who identified it. Describe the significant terms of the contractual arrangements to which the card product misclassification matter relates, including the rights
and obligations of the parties. Specifically address circumstances when there is a breach, default, or billing dispute under the contract. </B></P></TD></TR></TABLE>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:9%; font-size:10pt; font-family:Times New Roman"><I><U>Response</U></I>: Capital One respectfully acknowledges the Staff&#146;s comment and respectfully advises the Staff that Discover has
provided its response in Annex A hereto. </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>2.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Tell us when you first determined that your financial statements contained errors related to the card
product misclassification matter. Describe each error in further detail and the relevant accounting literature considered. </B></P></TD></TR></TABLE>
<P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:9%; font-size:10pt; font-family:Times New Roman"><I><U>Response</U></I>: Capital One respectfully acknowledges the Staff&#146;s comment and respectfully advises the Staff that Discover has
provided its response in Annex A hereto. </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>3.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Please tell us what control deficiencies were identified in connection with the card product
misclassification matter and explain whether the deficiencies related to the design or operating effectiveness of the controls. Additionally, please explain: </B></P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="14%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left"><B>&#149;</B></TD>
<TD WIDTH="2%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt"><B>how you assessed the severity of each control deficiency and describe the factors that affected the magnitude
of the misstatement that might result from the control deficiencies, including (i)&nbsp;the total monetary amount of the transactions exposed to the deficiency and (ii)&nbsp;the volume of activity in the class of transactions exposed to the
deficiency; and </B></P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="3%" VALIGN="top" ALIGN="left"><B>&#149;</B></TD>
<TD WIDTH="2%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt"><B>your plans to remediate the identified control deficiencies and the status of the remediation efforts.
</B></P></TD></TR></TABLE> <P STYLE="margin-top:6pt; margin-bottom:0pt; text-indent:9%; font-size:10pt; font-family:Times New Roman"><I><U>Response</U></I>: Capital One respectfully acknowledges the Staff&#146;s comment and respectfully advises the
Staff that Discover has provided its response in Annex A hereto. </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>4.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>We note your assertion that the card product misclassification relates to revenue recognized under ASC 606.
Provide a more fulsome explanation of the errors that existed in your application of ASC 606 and, by reference to the steps within ASC 606, how you quantified the ASC 606 error corrections. Include in your response, but do not limit it to the points
below. To the extent that there are different types of contracts or customers to which the ASC 606 errors relate, tailor your response to address those differences. Include specific citation to ASC 606 as necessary to explain your error correction.
</B></P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="14%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left"><B>&#149;</B></TD>
<TD WIDTH="2%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt"><B>Identify for which of the five steps within ASC 606 your initial accounting was in error.
</B></P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="14%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left"><B>&#149;</B></TD>
<TD WIDTH="2%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt"><B>Clarify and describe the unit of account within Step 1 of ASC 606 (e.g., a single contract, combined
contracts, etc.) to which the errors relate, describe each of the performance obligations within that contract, and identify the specific performance obligation(s) to which the errors relate. </B></P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="14%">&nbsp;</TD>
<TD WIDTH="3%" VALIGN="top" ALIGN="left"><B>&#149;</B></TD>
<TD WIDTH="2%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt"><B>For the contracts identified in Step 1 of ASC 606 to which the error relates, explain how in both your initial
and corrected accounting you determined transaction price and allocated it to the performance obligations within the contract, explicitly identifying the differences between your initial and corrected accounting. </B></P></TD></TR></TABLE>
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT REQUESTED PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P>
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 </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">U.S. Securities and Exchange Commission </P>
<P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">September&nbsp;3, 2024 </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"> Page
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 <P STYLE="margin-top:0pt; margin-bottom:0pt; text-indent:9%; font-size:10pt; font-family:Times New Roman"><I><U>Response</U></I>: Capital One respectfully acknowledges the Staff&#146;s comment and
respectfully advises the Staff that Discover has provided its response in Annex A hereto. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">*&#8195;*&#8195;*&#8195;*&#8195;*&#8195;* </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; text-indent:9%; font-size:10pt; font-family:Times New Roman">If you have any questions, please do not hesitate to contact me at (212) <FONT STYLE="white-space:nowrap">403-1367,</FONT> or my partner
Matthew M. Guest at (212) <FONT STYLE="white-space:nowrap">403-1341.</FONT> </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
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<TD VALIGN="top">Very truly yours,</TD></TR>
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<TD HEIGHT="16"></TD></TR>
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<TD VALIGN="top">/s/ Brandon C. Price</TD></TR>
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<TD VALIGN="top">Brandon C. Price</TD></TR>
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<TD WIDTH="9%" VALIGN="top" ALIGN="left">cc:</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Matthew W. Cooper, General Counsel and Corporate Secretary, Capital One Financial Corporation
</P></TD></TR></TABLE> <P STYLE="margin-top:0pt; margin-bottom:0pt; margin-left:9%; font-size:10pt; font-family:Times New Roman">Matthew M. Guest, Wachtell, Lipton, Rosen&nbsp;&amp; Katz </P>
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 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt; margin-top:0pt; margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>ANNEX A </B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>CONFIDENTIAL TREATMENT REQUESTED PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED
PORTIONS OF THIS LETTER. </U></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>INFORMATION THAT WAS OMITTED IN THE EDGAR VERSION HAS BEEN NOTED IN THIS LETTER WITH A PLACEHOLDER IDENTIFIED BY THE MARK
&#147;[***]&#148;. </U></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; margin-left:55%; text-indent:-2%; font-size:10pt; font-family:Times New Roman">September&nbsp;3, 2024 </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">U.S. Securities and Exchange Commission </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Division of Corporation
Finance </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">100 F Street, NE </P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Washington, D.C. 20549 </P>
<P STYLE="font-size:18pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="10%" VALIGN="top" ALIGN="left">Attention:</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Michael Henderson </P></TD></TR></TABLE>
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<TD WIDTH="10%" VALIGN="top" ALIGN="left">&#8195;</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Amit Pande </P></TD></TR></TABLE>
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<TD WIDTH="10%" VALIGN="top" ALIGN="left">&#8195;</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Robert Arzonetti </P></TD></TR></TABLE>
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<TD WIDTH="10%" VALIGN="top" ALIGN="left">&#8195;</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Christian Windsor </P></TD></TR></TABLE> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="15%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>Re:</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Capital One Financial Corporation </B></P></TD></TR></TABLE>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="15%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>&#8195;</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Amendment No.&nbsp;2 to Registration Statement on Form <FONT STYLE="white-space:nowrap">S-4</FONT>
</B></P></TD></TR></TABLE>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="15%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>&#8195;</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Filed July&nbsp;26, 2024 </B></P></TD></TR></TABLE>
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<TD WIDTH="15%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>&#8195;</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>File <FONT STYLE="white-space:nowrap">No.&nbsp;333-278812</FONT> </B></P></TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Dear Messrs. Henderson, Pande, Arzonetti and Windsor: </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Discover
Financial Services (&#147;<U>Discover,</U>&#148; &#147;<U>our</U>&#148;), is pleased to provide this response to the comments of the Staff (the &#147;<U>Staff</U>&#148;) of the Division of Corporation Finance (the &#147;<U>Division</U>&#148;) of the
U.S. Securities and Exchange Commission set forth in its letter, dated August&nbsp;6, 2024 with respect to the above-referenced Amendment No.&nbsp;2 to the Registration Statement on Form <FONT STYLE="white-space:nowrap">S-4</FONT> (the
&#147;<U>Registration Statement</U>&#148;). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">For the Staff&#146;s convenience, the text of the Staff&#146;s comments is set forth below in bold, followed
in each case by our response. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Amendment No.&nbsp;2 to Registration Statement on Form <FONT STYLE="white-space:nowrap">S-4</FONT> </U></B></P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Recent Developments </U></B></P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B><U>Discover Card
Misclassification, page 17 </U></B></P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>1.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Please provide a more detailed explanation of the card product misclassification matter, including the
cause, when it was first identified in the organization, how it was identified, and who identified it. Describe the significant terms of the contractual arrangements to which the card product misclassification matter relates, including the rights
and obligations of the parties. Specifically address circumstances when there is a breach, default, or billing dispute under the contract. </B></P></TD></TR></TABLE>
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 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I><U>Response</U></I>: </P>
<P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><B>Introductory Overview </B></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>Credit Card Transactions in
General </U></P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The typical entities involved in a credit card transaction are: (1)&nbsp;the consumer, who elects to pay for a purchase with a credit card;
(2)&nbsp;the consumer&#146;s issuing bank, which issues the credit card to the consumer and maintains the cardholder relationship; (3)&nbsp;the network, which facilitates the credit card transaction by communicating financial information from the
consumer&#146;s issuing bank to the applicable acquirer and vice-versa; (4)&nbsp;the acquirer, which maintains the merchant relationship and acts as an intermediary between merchants and the network; and (5)&nbsp;the merchant, which agrees to accept
credit cards from consumers as payment for purchases and contracts with an acquirer to process those transactions. In some instances, merchants contract directly with the network to accept particular credit cards and there is no acquirer. These are
generally large merchants. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">When a merchant contracts directly with a network (i.e., there is not an acquirer between the merchant and the network), the
merchant generally is charged a transaction processing fee, referred to as merchant discount rate (&#147;MDR&#148;) or simply &#147;merchant discount,&#148; which ordinarily includes both variable and fixed elements. When a merchant contracts with
an acquirer, the merchant pays the fees that the acquirer charges for each transaction, a component of which generally is interchange that the network assesses. MDR typically will vary based on card product type (Consumer, Commercial, etc.), the
type of transaction <FONT STYLE="white-space:nowrap">(in-person</FONT> vs. online), industry of merchant, and other factors. </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>Discover&#146;s Credit
Card Business </U></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The credit card business of Discover Financial Services (&#147;DFS&#148; or &#147;Discover&#148;) is conducted through two wholly-owned
subsidiaries: DFS Services LLC (&#147;Discover Network&#148;) and Discover Bank. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Discover Bank issues Discover-branded credit cards to consumers. As an
issuer, Discover Bank is responsible for assigning individual Discover credit cards to the merchant discount and interchange &#147;tiers&#148; using the criteria set by Discover Network in its Credit Operating Regulations (&#147;COR&#148;), which
are the Discover Network Operating Regulations that apply to issuing banks. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Discover Network is a system to route and settle transactions between
counterparties. Discover Network publishes and distributes Merchant Operating Regulations (&#147;MOR&#148;), Acquirer Operating Regulations (&#147;AOR&#148;), fee guides and manuals (&#147;Fee Manuals&#148;), technical specifications, and other
documents (collectively, &#147;Program Documents&#148;) that govern the relationships between Discover Network, merchants, and acquirers. The COR, MOR, and AOR, among other things, describe and define the different tiers that can be assigned to
credit cards issued on the Discover Network, which currently include different Commercial products (i.e., Business, Corporate) and different Consumer products (i.e., Core, Rewards, Premium, and Premium Plus). The Fee Manuals describe the MDRs and
interchange fees that direct merchants and acquirers pay when using the Discover Network for credit card transactions. Card pricing tier definitions do not differ between the respective pricing guidance for direct merchants and merchant acquirers.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***] </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Discover Network contracts directly with certain
merchants (&#147;direct merchants&#148;) and with acquirers. Direct merchants generally are large merchants; Discover Network contracts with direct merchants through a merchant services agreement, the MOR, and the other Program Documents. Acquirers
have relationships with both Discover Network and their merchant and payment intermediary clients; acquirers contract with DFS to submit transactions to Discover Network on behalf of their merchant and payment intermediary clients. Merchants who
contract (directly or through payment intermediaries) with acquirers, rather than directly with Discover Network, are referred to as third-party acquired merchants (&#147;TPA merchants&#148;). </P>
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 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Direct merchants receive the dollar value of their Discover Network transactions directly from Discover Network,
less the MDR. TPA merchants, on the other hand, receive the dollar value of their Discover Network transactions from their acquirer, less fees charged and determined by the acquirer (a component of which generally is interchange).<SUP
STYLE="font-size:75%; vertical-align:top">1</SUP> [***] </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">MDR and interchange income is collected as part of the settlement of card payment transactions
with merchants or acquirers, which generally occurs daily. The amount of fees assessed on each transaction is computed systematically based on the pricing tier associated with the cardholder, the type of transaction (e.g., retail, supermarket,
automated fuel dispenser, etc.) and conditions of the transaction (e.g., <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">card-not-present,</FONT></FONT> <FONT STYLE="white-space:nowrap">e-commerce,</FONT> etc.) among other factors.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Direct merchants receive monthly statements from Discover Network. TPA merchants [***] receive statements from the merchant acquirers with whom they have
a contractual relationship. Merchant acquirers receive statements from Discover Network daily through an online portal. Examples of billing statements for a merchant acquirer and a direct merchant are provided in Appendices A and B, respectively.
</P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***] If Discover Network revises its card product definitions, it is obligated to provide notice to direct merchants and acquirers. Notification is made
through monthly bulletins and network releases. [***] </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">As previously noted, Discover Bank, as the card issuer, is responsible for assigning credit cards
to merchant discount and interchange tiers. Discover Bank has flexibility within the rules imposed by Discover Network to place such cards into the tiers it deems appropriate based on the regulations and definitions. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">When disagreements arise with respect to pricing, they are addressed pursuant to the MORs and AORs, each of which contains a Resolution of Disagreements
provision. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***] </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The Misclassification does not apply to
any product offered by Discover Bank or any affiliates other than credit cards. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***] </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>2.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Tell us when you first determined that your financial statements contained errors related to the card
product misclassification matter. Describe each error in further detail and the relevant accounting literature considered. </B></P></TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I><U>Response</U></I>: The response to Question 1 above provides the background and describes the root cause of the Misclassification. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***] </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I><U>Concluding that an Accounting Error Had Occurred
</U></I></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Discover considered the definition of an accounting error, which is &#147;an error in recognition, measurement, presentation, or disclosure in
financial statements resulting from mathematical mistakes, mistakes in the application of generally accepted accounting principles (&#147;GAAP&#148;), or oversight or misuse of facts that existed at the time the financial statements were prepared. A
change from an accounting principle that is not generally accepted to one that is generally accepted is a correction of an error.&#148; [***] </P>
<P STYLE="line-height:8.0pt;margin-top:0pt;margin-bottom:2pt;border-bottom:1px solid #000000;width:11%">&nbsp;</P>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="4%" VALIGN="top" ALIGN="left"><SUP STYLE="font-size:75%; vertical-align:top">1</SUP>&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">The two basic forms of arrangement under which Discover Network is connected to merchants are through direct
merchant arrangements and TPA arrangements; however, there are other variations that exist, such as where a service provider serves as an intermediary between a merchant acquirer and end merchants.
</P></TD></TR></TABLE>
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 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt; margin-top:0pt; margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Having determined that an accounting error had occurred, Discover undertook a quantitative and qualitative
materiality analysis to determine the appropriate manner of correcting it. ASC <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">250-10-45-23</FONT></FONT></FONT> prescribes the manner of restating
financial statements for the correction of an error, but ASC <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">105-10-05-6</FONT></FONT></FONT> dictates that provisions of the Codification need not be
applied to immaterial items. Discover considered SEC Staff Accounting Bulletin (&#147;SAB&#148;) No.&nbsp;99, Materiality (codified in ASC <FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">250-10-S99),</FONT></FONT> and SAB 108,
Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in the Current Year Financial Statements (codified in ASC
<FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap"><FONT STYLE="white-space:nowrap">250-10-S99-2),</FONT></FONT></FONT> when performing its materiality assessment. Based on Discover&#146;s comprehensive materiality assessment,
Discover determined that none of the previously issued financial statements contained a material error as a result of the card product classification matter. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***] </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Because the error was determined to be not material to
previously issued financial statements, those statements could continue to be relied upon and the error could be corrected prospectively. However, as correction of the cumulative misstatement was material to results for the six months ended
June&nbsp;30, 2023, Discover determined that the appropriate manner of correcting the error was to restate impacted amounts in prior comparative periods presented in its subsequent filings, beginning with the second quarter 2023. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In correcting the financial statements, the recognition of the initial liability of $365&nbsp;million as of June&nbsp;30, 2023 was recorded with a
$10&nbsp;million reversal of discount and interchange revenue for the second quarter of 2023 and another $355&nbsp;million in offsetting adjustments to merchant discount and interchange revenue in prior periods presented and beginning retained
earnings for the earliest period presented. Because the Misclassification impacted the amount of discount and interchange revenue it had previously recognized, Discover deemed it appropriate to record the error correction as an adjustment to that
financial statement line item. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***] </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>3.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>Please tell us what control deficiencies were identified in connection with the card product
misclassification matter and explain whether the deficiencies related to the design or operating effectiveness of the controls. Additionally, please explain: </B></P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TR style = "page-break-inside:avoid">
<TD WIDTH="10%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left"><B>&#149;</B></TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt"><B>how you assessed the severity of each control deficiency and describe the factors that affected the magnitude
of the misstatement that might result from the control deficiencies, including (i)&nbsp;the total monetary amount of the transactions exposed to the deficiency and (ii)&nbsp;the volume of activity in the class of transactions exposed to the
deficiency; and </B></P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
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<TD WIDTH="10%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left"><B>&#149;</B></TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt"><B>your plans to remediate the identified control deficiencies and the status of the remediation efforts.
</B></P></TD></TR></TABLE> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I><U>Response</U></I>: Discover&#146;s assessment of internal controls over financial reporting noted while merchant discount and
interchange revenue was an <FONT STYLE="white-space:nowrap">in-scope</FONT> financial statement line item for the impacted periods for SOX purposes, the existing controls focused on the review and approval of pricing changes, third party management
controls, data integrity and mathematical accuracy of the calculation of revenue based on the Program Documents. Furthermore, although financial reporting controls related to review of financial statements were in scope for SOX purposes, these
controls would not have identified inaccurate tiering of cards issued by Discover Bank. Discover management determined that there was a design deficiency in internal controls over financial reporting in that Discover did not have a control to review
that cards issued by Discover Bank were appropriately tiered in compliance with the Program Documents. [***] </P>
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<HR SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">


<Center><DIV STYLE="width:8.5in" align="left">

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">In assessing the severity of the control deficiency, Discover concluded that it was a significant deficiency and
not a material weakness. Pursuant to AS 1305, the PCAOB defines material weaknesses as: </P> <P STYLE="margin-top:6pt; margin-bottom:0pt; margin-left:4%; font-size:10pt; font-family:Times New Roman">&#147;<I>a deficiency, or a combination of
deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of Discover&#146;s annual or interim financial statements will not be prevented or detected on a timely
basis.</I>&#147; </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Discover evaluated the indicators of a material weakness pursuant to PCAOB AS 2201.69 [***] </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Discover further considered other mitigating factors and compensating controls that could identify and prevent a material misstatement in the merchant
discount and interchange revenue line item, noting that there are appropriate controls in place that are designed and operating effectively to prevent a material misstatement of merchant discount and interchange revenue. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">While Discover management determined that the control deficiency was not a material weakness, the following considerations led to the conclusion that it was a
significant deficiency. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Pursuant to AS 1305, the PCAOB defines a significant deficiency as: </P>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="9%">&nbsp;</TD>
<TD WIDTH="4%" VALIGN="top" ALIGN="left">o</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">&#147;<I>a deficiency, or a combination of deficiencies, in internal control over financial reporting that is
less severe than a material weakness, yet </I><B><I><U>important enough to merit attention by those responsible for oversight of the company&#146;s financial reporting</U></I></B><I>.</I>&#148; [Emphasis added] </P></TD></TR></TABLE>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***] </P> <P STYLE="margin-top:18pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><U>Card Product Reclassification Plan and Related
Controls </U></P> <P STYLE="margin-top:6pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Discover undertook a remediation plan that incorporated the design and implementation of controls to address both the card tiering and the
restitution liability. [***] </P> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="4%">&nbsp;</TD>
<TD WIDTH="5%" VALIGN="top" ALIGN="left"><B>4.</B></TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left"><B>We note your assertion that the card product misclassification relates to revenue recognized under ASC 606.
Provide a more fulsome explanation of the errors that existed in your application of ASC 606 and, by reference to the steps within ASC 606, how you quantified the ASC 606 error corrections. Include in your response, but do not limit it to, the
points below. To the extent that there are different types of contracts or customers to which the ASC 606 errors relate, tailor your response to address those differences. Include specific citation to ASC 606 as necessary to explain your error
correction. </B></P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="10%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left"><B>&#149;</B></TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt"><B>Identify for which of the five steps within ASC 606 your initial accounting was in error.
</B></P></TD></TR></TABLE> <P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="10%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left"><B>&#149;</B></TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt"><B>Clarify and describe the unit of account within Step 1 of ASC 606 (e.g., a single contract, combined
contracts, etc.) to which the errors relate, describe each of the performance obligations within that contract, and identify the specific performance obligation(s) to which the errors relate. </B></P></TD></TR></TABLE>
<P STYLE="font-size:6pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="10%">&nbsp;</TD>
<TD WIDTH="2%" VALIGN="top" ALIGN="left"><B>&#149;</B></TD>
<TD WIDTH="1%" VALIGN="top">&nbsp;</TD>
<TD ALIGN="left" VALIGN="top"> <P ALIGN="left" STYLE=" margin-top:0pt ; margin-bottom:0pt; font-family:Times New Roman; font-size:10pt"><B>For the contracts identified in Step 1 of ASC 606 to which the error relates, explain how in both your initial
and corrected accounting you determined transaction price and allocated it to the performance obligations within the contract, explicitly identifying the differences between your initial and corrected accounting. </B></P></TD></TR></TABLE>
</DIV></Center>


<p style="margin-top:1em; margin-bottom:0em; page-break-before:always"> </p>
<HR SIZE="3" style="COLOR:#999999" WIDTH="100%" ALIGN="CENTER">


<Center><DIV STYLE="width:8.5in" align="left">

 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman"><I><U>Response</U></I>: </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***] </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Discover Network transactions during the years 2007
through 2023 with merchants who accepted Discover Card payments resulted in the recognition of merchant discount and interchange revenue by Discover. The amounts recognized were consistent with the card product classifications applied by Discover
Bank to credit cards it issued and the rates associated with the assigned pricing tiers and published in the applicable Program Documents [***]. In all cases, revenue was recognized upon the processing and settlement of the transaction (i.e., when
services were rendered under SAB Topic 13 and when the performance obligation was satisfied under ASC 606). </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***], from 2007 through December&nbsp;31,
2017, merchant discount and interchange revenue was recognized by Discover consistent with SAB Topic 13, Revenue Recognition. With the change in GAAP for revenue recognition beginning January&nbsp;1, 2018 pursuant to FASB Accounting Standards Update
<FONT STYLE="white-space:nowrap">2014-09,</FONT> merchant discount and interchange revenue was recognized consistent with ASC Topic 606, Revenue from Contracts with Customers. </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">[***] </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">The estimated liability of $365&nbsp;million as of
June&nbsp;30, 2023 covered all periods initially understood to have been affected by the Misclassification. [***]. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">Discover&#146;s consideration of
contractual and contingent components of the $365&nbsp;million CRP liability at June&nbsp;30, 2023 and subsequent periods was made to ensure the appropriate recognition and <FONT STYLE="white-space:nowrap">de-recognition</FONT> of those components
under ASC Topics 405 and 450, respectively. [***]. </P> <P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">*&#8195;*&#8195;*&#8195;*&#8195;*&#8195;* </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman">We would be pleased to discuss any of the foregoing responses to the extent you require further clarification or additional information. If you have any
questions, please do not hesitate to contact me at (224) <FONT STYLE="white-space:nowrap">405-3055.</FONT> </P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P><DIV ALIGN="right">
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<TR>

<TD WIDTH="100%"></TD></TR>


<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top">Very truly yours,</TD></TR>
<TR STYLE="font-size:1pt">
<TD HEIGHT="16"></TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="top" STYLE="BORDER-BOTTOM:1px solid #000000">/s/ Shifra C. Kolsky</TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom">Shifra C. Kolsky</TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom">Senior Vice President</TD></TR>
<TR STYLE="page-break-inside:avoid ; font-family:Times New Roman; font-size:10pt">
<TD VALIGN="bottom">Controller and Chief Accounting Officer</TD></TR>
</TABLE></DIV> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="4%" VALIGN="top" ALIGN="left">cc:</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Mr.&nbsp;John&nbsp;T. Greene, EVP and CFO, Discover Financial Services </P></TD></TR></TABLE>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="4%" VALIGN="top" ALIGN="left">&#8195;</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Ms.&nbsp;Hope&nbsp;D. Mehlman, GC and CLO, Discover Financial Services </P></TD></TR></TABLE>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="4%" VALIGN="top" ALIGN="left">&#8195;</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Mr.&nbsp;David Berrey, Deloitte&nbsp;&amp; Touche LLP </P></TD></TR></TABLE>
<TABLE STYLE="BORDER-COLLAPSE:COLLAPSE; font-family:Times New Roman; font-size:10pt" BORDER="0" CELLPADDING="0" CELLSPACING="0" WIDTH="100%">
<TR style = "page-break-inside:avoid">
<TD WIDTH="4%" VALIGN="top" ALIGN="left">&#8195;</TD>
<TD ALIGN="left" VALIGN="top"> <P STYLE=" margin-top:0pt ; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman; " ALIGN="left">Mr.&nbsp;Jared&nbsp;M. Fishman, Sullivan&nbsp;&amp; Cromwell LLP </P></TD></TR></TABLE>
</DIV></Center>


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 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">APPENDIX A </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[***] </P>
</DIV></Center>


<p style="margin-top:1em; margin-bottom:0em; page-break-before:always"> </p>
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 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">APPENDIX B </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[***] </P> <P STYLE="font-size:12pt; margin-top:0pt; margin-bottom:0pt">&nbsp;</P>
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 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">APPENDIX C </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[***] </P>
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 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">APPENDIX D </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[***] </P>
</DIV></Center>


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 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">APPENDIX E </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[***] </P>
</DIV></Center>


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 <p STYLE="margin-top:0pt;margin-bottom:0pt ; font-size:8pt">&nbsp;</P> <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center"><B>CONFIDENTIAL TREATMENT
REQUESTED BY DISCOVER FINANCIAL SERVICES PURSUANT TO 17 C.F.R. &#167; 200.83 (RULE 83) </B></P> <P STYLE="font-size:12pt;margin-top:0pt;margin-bottom:0pt">&nbsp;</P>
 <P STYLE="margin-top:0pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">APPENDIX F </P>
<P STYLE="margin-top:12pt; margin-bottom:0pt; font-size:10pt; font-family:Times New Roman" ALIGN="center">[***] </P>
</DIV></Center>

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end
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
