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Citigroup accidentally transfers $ 900 million to hedge funds

That went wrong: The American Citigroup accidentally repaid a 900 million loan to its creditors. Now a hedge fund refuses to reimburse a huge sum.

The US bank Citigroup wants to force the hedge fund Brigade Personal-Financial.com Management to return around 175 million dollars in court after a wrong transfer. In contrast to many other recipients of the erroneous transfer, Brigade refused to reimburse its share, argued Citigroup in the lawsuit filed in a New York court. The hedge fund was initially unable to provide any comments.

Citigroup last week repaid a nearly $ 900 million loan from ailing cosmetics manufacturer Revlon to its creditors. Citigroup actually only wanted to transfer the interest due on behalf of Revlon and not – as it happened by mistake – to repay the entire loan.

Hedge fund should only receive 1.5 million

According to the lawsuit, Brigade Personal-Financial.com was only supposed to receive $ 1.5 million in interest on a loan held by the hedge fund. The bank transferred $ 176 million instead. Obviously it was a mistake.

“Citibank had no intention of transferring more money than was announced in the payment notices, nor any money of its own.” When the error was discovered, the bank immediately asked the recipient to repay the funds. Most recipients would have repaid the money promptly.

The cosmetics manufacturer Revlon, whose sales were already shrinking before the Corona crisis, is fighting for survival. The loan remitted by Citigroup was granted in 2016 and will not be due in three years.

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