A federal judge has ruled that Citibank isn't entitled to the return of $500 million it sent to various creditors last August. Kludgey software and a poorly designed user interface contributed to the massive screwup.
Citibank was acting as an agent for Revlon, which owed hundreds of millions of dollars to various creditors. On August 11, Citibank was supposed to send out interest payments totaling $7.8 million to these creditors.
However, Revlon was in the process of refinancing its debt—paying off a few creditors while rolling the rest of its debt into a new loan. And this, combined with the confusing interface of financial software called Flexcube, led the bank to accidentally pay back the principal on the entire loan—most of which wasn't due until 2023.
Been following this. It’s a strange case with lots of complications.
I remember when a former employer made a technical error and made 1.9B in erroneous payments. We got it all back, even though some went to some sketchy counterparties.
-------------------------------- If you think looting is bad wait until I tell you about civil forfeiture.
Posts: 33811 | Location: On the Hudson | Registered: 20 April 2005
