REUTERS - Reuters

A federal judge on Tuesday said Citigroup Inc C.N is not entitled to recoup half a billion dollars of its own money that it mistakenly wired lenders of Revlon Inc, in what he called "a banking error of perhaps unprecedented nature and magnitude."


Published on Feb. 16th, 2021 Published on Feb. 16th, 2021

MSTAR comment

This is the conclusion of the news published on August 15. This case illustrates the driver "Loss rate" used in the Wire Transfer Error scenario, and the assumption considering that this loss rate is very rarely equal to 100%. In this particular event, this was the case, as NY judge Jesse Furman ruled, citing a precedent from a 1991 case in which New York's highest court ruled that when a third party mistakenly sends money from a debtor to a creditor, the creditor can keep the payment if it didn’t realize it was sent in error and didn’t make any misrepresentations — a principle called discharge for value.
Scenario: Error / Wire Transfer Error

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