DThat American financial group Citibank cannot transfer $ 500 million to a mutual fund by mistake. A New York judge ruled on Tuesday. Citibank, in its ruling, wrote to Judge Jesse Furman, “committed one of the biggest mistakes in banking history.”
Citibank mistakenly sent $ 900 million to cosmetics company Revlon’s creditors in August last year. In fact, the bank that provided the loan wanted to transfer a loan interest of $ 7.8 million. However, the entire loan amount including interest was repaid.
When the error was noticed, he asked Citigroup Money back, but only $ 400 million paid back. Ten mutual funds refused to repay. Due to this, the case ended in court.
Citibank announced its appointment
Judge Furman has now stated that under US law, money transferred incorrectly should generally be returned. New York state law provides for an exception: “The recipient may hold the money if it is used to pay off legitimate debts, the recipient has not provided any false information to trigger the payment, and If the recipient has not paid attention. Error “, wrote the decree.
In this case, the creditors considered “in good faith” and with sufficient justification that Revlon returned the debt in early 2016. Between that notion and the notion that “Citibank or Revlon had accidentally transferred more than $ 900 million – something that the bank has probably never done before and probably never will – it would be almost irrational to speculate.” The judge wrote.
Citibank strongly rejected the decision and announced that it would appeal. A spokesman said that Citibank is entitled to the money and will continue to campaign for full repayment.
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