Maybe it's like that Hawaii mistake, the "pay installments" button was right next to the "repay full loan" button.

Also, that it now happened to 900M means it has probably happened before to smaller loans before, I bet there's some sort of law about that.

I think this is a bit of a jump

> Let’s consider how this should likely play. The loss here of Citi isn’t materially that they lose the money. It would get rolled into a loan to Revlon at the same rates. Revlon still has to pay it, just Citi has to float the time.

Neither Citi or Revlon have agreed to lend/borrow money from each other. Citi isn’t party to any of the loans Revlon has taken out (other than as a financial administrator). So why would Citi suddenly just taken on this loan to Revlon?

It would like if your bank accidentally paid off your credit card (we’ll ignore how that might actually happen). You wouldn’t suddenly have a loan agreement with your bank.

How would that work? Neither party agreed any terms. What would the interest rate be, repayment period etc?

Your bank won’t even know what agreement you had with your credit card provider, so they would need to rely on you being honest about what you owed and the interest to pay. And no they couldn’t just ask your credit card provider, that would be a massive breach of privacy.

That’s ignoring the fact there’s no guarantee that your bank can support such a loan. Even if they have the cash, they might not be able to continue meeting their regulatory capital and liquidity requirements. Especially as it would be a high risk loan (both in your hypothetical scenario and in Citi’s real scenario).

In short there are many reasons why you can’t just go “oh it’s your loan and your problem now, good luck with the hot potato”.

> I owe 150 in interest but instead I send 1,500. Would they refund the mistake? Let’s go ahead and follow the headline and say I paid 9k of my 15k balance. Would they refund the mistake? (Honest question) This scenario is at the consumer level and zeros matter but I see sloppiness somewhere in Citi and their dealing with money when it’s specifically what they are trusted to do. As for the “loss”...

It's different for a very important reason.

Revlon didn't authorize the money to be sent. This is like you telling your bank to send a check to AMEX for $150 and they put down $1500 on the check, it comes out of their funds, not yours, and then when AMEX cashes the check that's when the mistake is discovered.

The important point is that Citi made the mistake not Revlon.

My guess is that if Citi loses the suit they'll end up being the lender for the part that Brigade loaned.

The problem is citi is the guarantor of the revlon loan .

It is more like your dad paying your credit bill in full instead of the minimum and now saying he wants the money back

I'm not finding anything that says Citibank is a guarantor, only administrator, whatever that means. If Citibank did guarantee the loan, then Brigade has no need to fear Revlon's bankruptcy right, since they'd be able to collect from Citi. Unless they're worried that Citi is going to go under, which is another kettle of fish.

It is cash flow . Everyone is in a crunch , if revlon default on this loan, and then go under , getting money of anyone will take a long while .

Brigade gave the loan pre pandemic , under very different conditions , today they are probably happy with the money back.

It could also be that They may other liabilities of their own, where this liquidity could be useful.

Under normal market you want as little of money with you, money in the bank does not earn much , it is doubly important if you are in the business of making investments .

However in poor confidence conditions you want as much liquidity as you can have which is why everyone starts buying treasuries when markets go south .

> The 900mm mistake is actually several mistakes not just 1 simple typo? How is that possible.

They probably repaid all lenders that are customers of Citibank and that took part in the $1.8 billion loan to Revlon. Maybe one button to "close" the loan? :)

If you're employer sent you 10x your monthly salary, you would be expected to return 9 of those x's. Not just "great, don't pay me again for 9 more months, let's hope I don't quit before then lol".

Right, but that's because I'm not owed 10x my monthly salary.

Yes, you are, just not yet, exactly like revlon/brigade.

No, you aren't. Unless he was on contract for the year, the salary for the rest of the year won't be paid in full if the employee leaves or is fired, for example.

A loan is the opposite.

Sorry to be blunt but... you're sort of wrong twice:

* EVEN IF he has a contract for the year, there would still be 1001 things that might happen between then and now that mean he isn't actually due payment (company bankruptcy, his death etc). That's why he cannot keep the money.

* And that is exactly the same position that Revlon\Brigade are in: Brigade are no more SURE they will get paid or that Revlon will even be legally required to pay them...

There’s a difference between obligation and payment terms.

I undoubtedly owe my mortgage lender for the full amount of the loan on my house. I can choose whether to just pay the monthly payment, or I can pay more at any time, up to the full outstanding principal. If I send my lender a bigger check, they’ll gladly cash it and apply it to the principal, and I don’t think I’d have any luck in asking for the money back. It’s implicit with most loans that the borrower can pre-pay ahead of the payment schedule at any time.

For my salary, my employer’s obligation is only for the past two weeks of work. Any overpayment on their part would be due back to them immediately.

I'm pretty sure if you could show that your bank made a mistake and transferred them 10x your mortgage payment, that they would give it back.

Probably. However if you pay off your mortgage by accident, they won't just give you back the money. They might also be uninterested in giving you a new mortgage if you are already declaring bankruptcy.

You may not be required to pay the full loan if your company goes bankrupt. A loan is a series of scheduled payments which are likely but not guaranteed to happen.

This actually happened to me, albeit more like 2.5x instead of 10x. I was told it was easier to take it out of my future salary, so that is what was done. The most annoying thing was trying to work out what I'd be paid the third month after taxes as we're taxed at source in the UK

I've always had it the other way with New jobs: "whoops, we screwed up and didn't pay you, maybe we'll get to it next month lols."

Yeah. I remember having the same issue, especially at places where they only pay people monthly l, in arrears, so sometimes it can take more than eight weeks after starting work to get a first paycheck.

Why do people keep confusing this with employment? This is like a mortgage! It was a loan that Brigade gave to Revlon. It's not like Brigade was doing work for Revlon.

It's all the same really: If your bank screwed up and 10x paid your mortgage, would you be happy to just stump up that cash or would you expect the error to be reversed? Is it reasonable for you to have 10 mortgage payments just sat around or would that payment cause you massive problems as you would have no money at all for food or fuel or taxes for quite a while?

> Let’s say 15k credit card with AMEX. I owe 150 in interest but instead I send 1,500. Would they refund the mistake?

Yes if you had exceeded your minimum payment: https://www.fool.com/the-ascent/credit-cards/articles/overpa...

Overpayment in credit card terms is typically when you pay more than the full balance, not more than the minimum payment. Getting a refund under the given circumstances (1500 on a 15k bill with a 150 min pay) might be possible from some lenders, but would almost certainly involve a lot of time on the phone with customer service reps.

Some of the earlier articles about this mentioned that Revlon is struggling and that the creditors were worried about getting paid back for the loan.

This seems like a really bad loan to service.

People need to get out of the idea that just because something or someone has extra 0s in their account, that they should be more liable for things. Mistakes can happen at all levels, if society intends to build fair and equitable environments, it needs to stop looking at group A or group B differently. Don't forget that if there is an undue burden to be 100% all of the time, it will be priced into the offering at some point, leading the end user to foot the bill.

> People need to get out of the idea that just because something or someone has extra 0s in their account, that they should be more liable for things.

Perhaps. The thing to note is that if someone loses a lot of money, they are treated far better in terms of societal resouces (courts, judges, police time etc.) than those who lose small amounts, even though if the system was fair all losses would be treated equally.

For example: if you tell the police you’ve had $500 in damage done to your car, they may get as far as filing a report but nothing else will usually happen. If a company has $500 million in property damage done, there will be an enormous investigation and the DA will be actively involved etc.

In other words, group A and group B are already looked at differently.

Let's take your example and just call it a $150k small business loan instead, since most small businesses will just be making the minimum interest payment, not really trying to pay it off quickly, where I could see a regular person throwing money at half their credit card debt after selling their car or something.