Citi Group Loses Battle To Recover Half A Billion Dollars

  • Citigroup Inc lost the legal battle to recover half a billion dollars it sent to Revlon Inc. leaders and forced to answers to regulators and tighten its internal controls after the embarrassing blunder.

  • On Tuesday, U.S District Judge Jesse Furman ruled that 10 asset managers for the lenders- which include Brigade Capital Management, HPS Investment Partners and Symphony Asset Management- don’t have to return $504 million that Citibank said it mistakenly transferred in August while trying to make an interest payment.

  • The Judge further added that they shouldn’t have expected to know that the transfer, which totalled more than $900 million before some lenders returned their share, was an error.

  • Furman wrote “To believe that Citibank, one of the most sophisticated financial institutions in the world, had made a mistake that had never happened before, to tune of nearly $1 billion would have been borderline irritated”.

  • Citigroup, that is said to be in the midst of a yearlong effort to update its underlying controls and technology after regulators slapped it with a $400 million fine for deficiencies in both areas last year has received this decision and judgement as its latest blow.

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