This is serious!

Citibank committed the “biggest blunders in banking history” after it wired half a billion dollars by mistake to Revlon’s lenders. US District Court judge ruled this week the bank cannot get the money back.

Acting as Revlon’s loan agent, Citibank wanted to transfer about $8 million in interest payments to the cosmetic company’s lenders. Unfortunately, it wired $500 million instead, including $175 million to a hedge fund. In all, the bank transferred $900 million to Revlon’s lenders by mistake.

New York law has exceptions to this rule, known as the “discharge-for-value-defense”. If the beneficiary is entitled to the money and did not know it was transferred by mistake, they can keep it. Revlon lenders said they thought Citibank was wiring prepayments for a loan. Hence, Court ruled they are right to keep the money.

“We are extremely pleased with Judge [Jesse] Furman’s thoughtful, thorough and detailed decision,” said Benjamin Finestone, who represented two lenders, Brigade and HPS Investment Partners.

Read more

https://newsbreakforum.com/story/citibank-cant-get-back-500m-it-wired-by-mistake-court-rules/

Sundaland:

New York law has exceptions to this rule, known as the “discharge-for-value-defense”. If the beneficiary is entitled to the money and did not know it was transferred by mistake, they can keep it. Revlon lenders said they thought Citibank was wiring prepayments for a loan. Hence, Court ruled they are right to keep the money.

https://newsbreakforum.com/story/citibank-cant-get-back-500m-it-wired-by-mistake-court-rules/

I guess it means Revlon will pay back to citibank somehow, since the lenders spent the money thinking it's from Revlon. But this is crazy! Prepayment for a loan? For the lenders to assume this is the case, Revlon must have initiated a loan, the lenders should just give the loan and use the fund for what they thought it was meant for so Revlon can pay the bank only capital without interest since Revlon didn't ask for it

backnbeta:


I guess it means Revlon will pay back to citibank somehow, since the lenders spent the money thinking it's from Revlon. But this is crazy! Prepayment for a loan? For the lenders to assume this is the case, Revlon must have initiated a loan, the lenders should just give the loan and use the fund for what they thought it was meant for so Revlon can pay the bank only capital without interest since Revlon didn't ask for it

They don’t need to pay back according to the ruling. The money is gone

Sundaland:




They don’t need to pay back according to the ruling. The money is gone

That's what I'm trying to understand o

owo ti wo voicemail

backnbeta:

That's what I'm trying to understand o

The bank must have learnt a tough lesson to be careful next time. Lol

The Wirer right now...