> ## Content Index > Fetch the complete content index at: https://whywecanthavenicethings.info/llms.txt > Use this file to discover other available public pages before exploring further. # Citibank Wired Revlon's Lenders $894 Million by Mistake Because Its Six-Eye Approval Process Ticked One Box Where Three Were Needed. A Judge Let Them Keep Half a Billion, Four Months After Regulators Fined Citibank $400 Million Over Its Internal Controls. - URL: https://whywecanthavenicethings.info/citibank-revlon-900-million-wire-flexcube-six-eye/ - Published: 2026-10-08T10:00:00.000Z - Updated: 2026-10-08T09:59:59.000Z - Author: The Complaints Department - Tags: Corporate Memo In 2016 Revlon took out a seven-year, $1.8 billion syndicated loan, due in 2023\. Citibank was the administrative agent: it collected Revlon's payments and passed them on to the lenders. On 11 August 2020 a group of lenders managed by Angelo, Gordon and Co. was swapping its share of the loan for a position in a different Revlon facility, and Revlon agreed to pay accrued interest, about $7.8 million, to every lender on the loan. The interest was not due until 28 August. Paying all of them early was, according to the court's later findings, a workaround for "technical limitations of Citibank's system." The system was Flexcube, the loan software Citibank used to initiate wire payments. The easiest, or perhaps the only, way to process the swap in Flexcube was to book it as if Revlon were repaying the entire loan, which would send the interest out to the lenders, and to route the principal, about $894 million, into a "wash account": an internal account used, in the words of a Citibank manager's affidavit, "to help ensure that money does not leave the bank." Revlon sent the money for the interest. Nobody sent any money for the principal, because the principal was not supposed to go anywhere. ## The Six Eyes Citibank ran transactions like this through a "six-eye" approval procedure, which requires three people to review and approve them. The maker was Santhosh Kuppusamy Ravi and the checker Arokia Raj, both Wipro employees who worked only on Citibank matters. The approver was Vincent Fratta, a Citibank senior manager in Delaware. Flexcube sends every payment out as a wire unless the maker overrides the default. Citibank's internal Fund Sighting Manual explained how: "ALL of the below field\[s\] must be set to the wash account: FRONT\[;\] FUND\[; and\] PRINCIPAL." Ravi, Raj and Fratta all believed that the PRINCIPAL field was enough. Between 5:15 and 5:45 p.m. Ravi ticked that one box. Raj passed the transaction up the chain with a note: "Principal set to Wash and Interest Notice released to Investors." Fratta replied, "Looks good, please proceed. Principal is going to wash." When Raj gave final approval, a warning appeared on his screen: "Account used is Wire Account and Funds will be sent out of the bank. Do you want to continue?" It did not say how much. Raj meant to send the interest, so he clicked "YES." A little after 6 p.m. he confirmed to the team that the principal had been "set to wash." That evening Ravi's screenshots showed $894 million in principal under "Amount Paid." He took that to mean the wash account. ## The Morning After At 9:37 a.m. on 12 August, reconciling the previous day's accounts, Raj found the breaks and wrote to Fratta that "it looks like funds ha\[ve\] gone out along with principal." Fratta told his own boss over Skype: "\[B\]ad news. \[P\]rincipal to wash, wires look\[\] like they went out the door." He emailed his team under the subject line "Urgent Wash Account Does not Work." By the afternoon he had learned that the cause was not a technical error but a human one: nobody had ticked FRONT or FUND. All 315 lenders had received their share of $893,944,008.52, paid with Citibank's own money. Citibank sent recall notices that afternoon. Some lenders returned their money, and Citibank eventually recovered about $385 million that way. Ten investment managers, whose clients had received more than $500 million, told their custodians to hold on to it. Brigade Capital wrote that "it is unclear to us that this was an error." At HPS, an analyst wrote in an internal email that the "erroneous paydowns" would go back first thing the next morning. A managing director overruled him and asked that the money be left out of the cash reports "so we don't invest it by accident." In an HPS chat that afternoon, one employee wrote: "I feel really bad for the person that fat fingered a $900mm erroneous payment. Not a great career move." A colleague replied that Citibank would "be looking for new people for their Ops group." ## The Regulator On 7 October 2020, eight weeks later, the Office of the Comptroller of the Currency fined Citibank $400 million for "deficiencies in enterprise-wide risk management, compliance risk management, data governance, and internal controls." The OCC cited the bank's "long-standing failure to establish effective risk management and data governance programs and internal controls," and issued a cease-and-desist order requiring it to get the OCC's non-objection before making significant new acquisitions. The press release did not mention Revlon. ## The Ruling On 16 February 2021 U.S. District Judge Jesse Furman ruled that the lenders could keep the money. He called the transfer "one of the biggest blunders in banking history." New York's discharge-for-value rule lets a creditor keep a mistaken payment that settles a real debt if it had no notice of the mistake. The wires matched Revlon's debt "to the penny," and Furman found the lenders had reasonably taken them for a deliberate prepayment. An early repayment, he reasoned, was far more plausible than the alternative, which happened to be true. "Citibank is one of the most sophisticated financial institutions in the world. Thus, Defendants and their clients could assume — and did, in fact, assume — that the bank had effective internal controls to avoid significant mistakes." To believe otherwise "would have been borderline irrational." Citibank's own witnesses had not helped. Asked whether he could remember Citibank ever mistakenly transferring more than $50 million in his fifteen-year career, Fratta answered: "I don't recall." ## The Reversal On 8 September 2022 the Second Circuit vacated the judgment, unanimously. Judge Pierre Leval's opinion pointed out what the lenders had known on 11 August. They believed Revlon to be "deeply insolvent", and the loan was trading at 20 to 30 cents on the dollar. On the day after the wires, a complaint filed on the lenders' behalf alleged that Revlon was insolvent by as much as $1.71 billion. That borrower had apparently just repaid nearly $1 billion at full face value three years early, without the contractually required notice. A prudent investor, Leval wrote, would have found that "bewilderingly improbable." He also turned Furman's point around: the fact that Citibank was "one of the most sophisticated financial institutions in the world" made it unlikely the bank would have forgotten to send that notice. Judge Michael Park concurred. He called it "a straightforward case that many smart people have grossly overcomplicated and that we should have decided many months ago," and summed it up: "Put simply, you don't get to keep money sent to you by mistake unless you're entitled to it anyway." Keeping it, he wrote, "would also be brutally unfair." Among the cases he cited for the ordinary rule was *Citibank, N.A. v. Warner* (1981), in which "the bank inadvertently microencoded the defendant's account number." In an addendum, Leval said the judgment had taken a long time to produce. "I take sole responsibility for that," he wrote. "I truly regret that I did not get the job done faster." By then Revlon had been in Chapter 11 since June. Citi said the ruling reaffirmed its belief that the funds "should be returned as a matter of law, as well as ethics," and said it had "taken steps to reduce the likelihood of such an error in the future." Its chief executive, Jane Fraser, had called the episode a "massive unforced error." In April 2024 Citigroup credited a client's account with $81 trillion instead of $280\. Two employees missed it, and a third caught it 90 minutes after it posted. No money left the bank, and it was reported to regulators as a "near miss." In July 2024 the OCC fined Citibank another $75 million and amended the 2020 order, citing the bank's "failure to meet remediation milestones." In 2020 all six eyes had missed the mistake. In 2024 four of them did, and the bank said its "detective controls promptly identified the inputting error." --- *Filed from public reporting:* - [U.S. District Court, Southern District of New York — "In re Citibank August 11, 2020 Wire Transfers, No. 20-CV-6539 (JMF), Findings of Fact and Conclusions of Law (February 16, 2021)"](https://www.nysd.uscourts.gov/sites/default/files/2021-02/20cv6539%20Citibank%20Opinion.pdf) - [U.S. Court of Appeals for the Second Circuit — "Citibank, N.A. v. Brigade Capital Management, LP, No. 21-487 (September 8, 2022)"](https://storage.courtlistener.com/pdf/2022/09/08/in%5Fre%5Fcitibank%5Faugust%5F11%5F2020.pdf) - [Office of the Comptroller of the Currency — "OCC Assesses $400 Million Civil Money Penalty Against Citibank"](https://www.occ.gov/news-issuances/news-releases/2020/nr-occ-2020-132.html) - [Office of the Comptroller of the Currency — "OCC Amends Enforcement Action Against Citibank, Assesses $75 Million Civil Money Penalty"](https://www.occ.gov/news-issuances/news-releases/2024/nr-occ-2024-76.html) - [CNN Newsource via ABC 17 News — "Citibank can't get back $500 million it wired by mistake, judge rules"](https://abc17news.com/money/2021/02/17/citibank-cant-get-back-500-million-it-wired-by-mistake-judge-rules/) - [Banking Dive — "Citi wins appeal on $500M Revlon loan blunder"](https://www.bankingdive.com/news/citi-wins-appeal-500-million-revlon-loan-blunder/631536/) - [Gulf News / Bloomberg — "Citi accidentally credits client account with $81 trillion: FT"](https://gulfnews.com/business/banking/citi-accidentally-credits-client-account-with-81-trillion-ft-1.500048948)