Citibank Seeks Freeze on Erroneous Transfers During Appeal

Citigroup Inc. asked a federal judge to freeze more than $500 million the bank mistakenly sent to Revlon Inc. creditors, saying the money could be distributed while it appeals his ruling that it’s not entitled to the funds.

The bank asked U.S. District Court Judge Jesse Furman in a court filing Tuesday to issue an injunction preserving the status quo, saying without it the creditors might send the money to hundreds of investors around the world.

“Those investors, in turn, could transfer the funds again, making Citibank’s funds very difficult, if not impossible, to trace,” the bank said. So, even if Citibank won its appeal “its victory would prove hollow,” it said.

Last month, Furman rejected the bank’s attempt to recover $504 million it accidentally sent to asset managers, including Brigade Capital Management, HPS Investment Partners and Symphony Asset Management, for Revlon lenders.

A current freeze remains in effect until Furman rules on the bank’s request.

The case is In re Citibank August 11, 2020 Wire Transfers, 20-cv-6539, U.S. District Court, Southern District of New York (Manhattan).

Read More:

©2021 Bloomberg L.P.

BQ Install

Bloomberg Quint

Add BloombergQuint App to Home screen.