Citibank Sent a Hedge Fund $175 million by Mistake. Now They Can’t Get it Back (CNN Business) London (CNN Business) Citibank has a big problem: It mistakenly wired roughly $175 million to Brigade Capital Management, and the hedge fund hasn’t returned the money. The US banking giant filed a lawsuit Monday in the Southern District of New York, seeking the return of funds that it said were transferred in an “operational mistake.” Citibank (C) said in court documents that it meant to send Brigade Capital around $1.5 million in interest payments on a loan the hedge fund made to troubled cosmetics company Revlon (REV). Instead, it wired roughly 100 times that amount of its own funds to the hedge fund. Other Revlon creditors also received erroneous payments adding up to $900 million.
OMG!! Looks like Citibank just have too much money lying around that it can send close to $1 billion just by mistake! Imagine how much money it can send legitimately. LOL C'mon, Citibank, stop the lawsuit, spread the love a bit!
It is not like they are just keeping the money. They are applying it as payment towards the loan. So it is not so simple I think.
uh, i feel Citibank's pain. but, if you invest in, say, a fraudulent hedge fund, and citibank is the prime broker and custodian of the funds, and citibank is sitting right there, looking at huge losses in the fund month after month, and citibank knows the hedge fund is reporting continual gains to the public, and citibank sees extemely little funds in the account, and citibank knows the hedge fund is reporting wildly inflated "assets under management" over $100,000,000, citibank will let you know they couldn't care less about your little problems when the fraud is finally revealed. don't ask me how i know. but i know.
Sounds like a Monopoly game card... "Bank error in your favor... collect $175 Million and don't give it back".
1) then who in the world would invest his/her money with Brigade Capital Management? (bad marketing) 2) did it look like a bank robbery? kinda an insider job, so instead of going straight to the front desk, pulled out a gun, and asked the clerk for the money, now one could go to work for a competitor, then consciously made grossly mistake (like adding extra zeros to a wire transfer), then once your accomplice got the money,... you two could move to Caribbean and split the money. hehehe
Citigroup Gets Freeze on Brigade Money in $900 Million Error (Bloomberg) Citigroup Inc. scored a temporary court order freezing $175 million that Brigade Capital Management LP declined to return after the bank accidentally transferred more than $900 million to Revlon Inc. lenders. The order followed a hearing Tuesday in which the bank and the hedge fund faced off over Citigroup’s expensive blunder. The two will be back in court on Wednesday as the judge determines the next steps in their legal battle, including whether to hold a hearing on the bank’s request for a preliminary injunction forcing Brigade to give the money back while the case proceeds. Citigroup sued Brigade on Monday.