The Law is The Law: Not pretty….#Citigroup loses bid to recover $500m sent to #Revlon #Debt Holders by mistake

US judge rules recipients can keep the money in case involving loan made to Revlon.

Despite finding that the money Citi sent was “indisputably transferred by mistake”, Jesse Furman, a US district judge in Manhattan, wrote that he was bound by precedent to rule in favour of the funds.

“Were the court writing on a blank slate,” the judge wrote, he might have ruled in favour of Citi, given that the bank “realised its error and notified the lenders within one day”.

But New York law is explicit, he found: a recipient may keep funds transferred by mistake if they pay off a debt, the recipient did not know of the mistake and the recipient did not trick the sender into making the payment.

Judge Furman said the recipients had good reason to believe the payments were intentional. “To believe that Citibank, one of the most sophisticated financial institutions in the world, had made a mistake that had never happened before, to the tune of nearly $1bn — would have been borderline irrational,” he wrote.

See the whole article on the FT here: Citigroup loses bid to recover $500m sent to funds by mistake