In re Citibank August 11, 2020 Wire Transfers
"On August 11, 2020, Citibank N.A. (“Citibank”), acting in its capacity as Administrative Agent for a syndicated term loan taken out by Revlon, Inc. (“Revlon”), intended to wire approximately $7.8 million in interest payments to Revlon’s lenders. Instead, it made one of the biggest blunders in banking history: It mistakenly wired, in addition to Revlon’s $7.8 million, almost $900 million of its own money as well. The resulting payments equaled — to the penny — the amounts of principal and interest that Revlon owed on the loan to its lenders. The question in this case is whether Citibank is entitled to get the money back or whether the lenders are allowed to keep it." 
SEDA EXPERTS' ROLE
SEDA's experts were retained by defendants to opine on how lenders in the market and their managers would respond to the receipt of wires such as those at issue in the case, and how surrounding circumstances and events would frame lenders’ understanding of payments received.
On February 16, 2021 the Court concluded that the Non-Returning Lenders are entitled to keep the money that Citibank indisputably transferred by mistake on August 11, 2020. That is, for the reasons discussed in the Findings of Fact & Conclusions of Law, the Court finds that the Non-Returning Lenders were not on notice of Citibank's mistake when they received the transfers. The transfers matched to the penny the amount of principal and interest outstanding on the loan. The accompanying notices referred to interest being "due," and the only way in which that would have been accurate was if Revlon was making a principal prepayment.
Mr. Smith has more than 40 years of experience in the US corporate loan market, both as the Executive Director of the Loan Syndications and Trading Association (LSTA) and senior executive in three leading financial institutions such as Bear Stearns, Morgan Stanley, and Bankers Trust. He is a world-class expert in loan syndications, sales and trading, and capital markets. Click here for his bio
Peter U. Vinella
Mr. Vinella possesses more than 35 years of experience in the financial services industry, including as the chief executive of an affiliate of a nationally-chartered bank (Wilmington Trust Company) offering corporate trust and fund administration services to issuers of and investors in structured financial products such as collateralized loan obligations and syndicated loans such as those at issue in this matter, as a senior executive at two major broker-dealers (Smith Barney Shearson and Drexel Burnham Lambert), and as a consultant to over 150 financial services clients around the world, including, without limitation, central banks, government agencies, and top-tier commercial banks, broker-dealers, and institutional investors. Click here for his bio
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