Citi Can’t Have Its $900 Million Back

StartupAnalyst

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Quote from: verita1 on February 26, 2021, 07:39:39 PM

Quote

DFREY5: How was work today honey? It was ok, except I accidentally sent $ 900mm out to people who weren’t supposed to have it
DFREY5: Downside of work from home. maybe the dog hit the keyboard

This argument seems so silly to me. How can it be possible? It is total negligence. A job as delicate as handling money and requiring maximum concentration can be done anywhere and blaming the dog is nonsense. I think a forensic investigation is needed. Banks show every day that they need urgent reform and must act as soon as possible because they will be displaced by cryptocurrencies.

These poor, innocent dogs. They are always guilty in people's negligence. This total situation sounds like some heads were fired and fined. Still don't understand how awkward and clumsy should be a person to pay back 900 million principal instead of eight millions in interest payments.

Silberman

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Quote from: stompix on February 18, 2021, 03:50:21 AM

What free money?
It is clearly said in the statement by the court:

Quote

When a beneficiary receives money to which it is entitled and has no knowledge that the money was erroneously wired, the beneficiary should not have to wonder whether it may retain the funds; rather, such a beneficiary should be able to consider the transfer of funds as a final and complete transaction, not subject to revocation.”

Those are money that Citi was supposed to pay anyway, not money they decided its fun to try and sent to different accounts.

This is the way I read the situation as well, Citi was trying to be smart and somehow avoid paying and then they did it by mistake, then they tried to recover that money with many of the recipients refusing, then they tried to get that money back with a lawsuit but the judge ruled against them because they are basically paying what they owed, if anything it is nice to see a bank not getting away with something at least once since most of the rulings and the laws are in their favour.

verita1

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Quote

DFREY5: How was work today honey? It was ok, except I accidentally sent $ 900mm out to people who weren’t supposed to have it

DFREY5: Downside of work from home. maybe the dog hit the keyboard

This argument seems so silly to me. How can it be possible? It is total negligence. A job as delicate as handling money and requiring maximum concentration can be done anywhere and blaming the dog is nonsense. I think a forensic investigation is needed. Banks show every day that they need urgent reform and must act as soon as possible because they will be displaced by cryptocurrencies.

paxmao

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Quote from: NeuroticFish on February 18, 2021, 03:25:54 AM

Quote from: Hydrogen on February 17, 2021, 07:09:33 PM

Perhaps someone can invent a new altcoin which addresses these concerns?

Wouldn't be that the most useless altcoin ever?
Just imagine, I'd send coins to the exchange, withdraw Bitcoin then revert the altcoin transaction. It would allow you get anything for free. Do you expect anyone - from exchanges to merchants - would be stupid enough to accept such a coin?!

Got a name for that... "doublespend token". Like a Black Lotus but for crypto.

aesma

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Interesting and funny story. I imagine the face of the people involved after realizing they sent the wrong amount.

Well, maybe at first they thought it could all be reversed, because if it was just a regular case of mistakenly sending money it would, especially between financial entities.

But here, with the shenanigans regarding the bonds, the people getting the money were actually owed the money, so it's easy for them to justify keeping it.

Rengga Jati

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This is indeed a very fatal mistake when (accidentally) sending the transaction.
But here, they know the receiving address belongs to, hmmm.
And they get "Free money". Wow, this is really amazing when we already know who the recipient of the money accidentally transferred to them and asked for the money back. I think that at least 80-90% will come back and we will leave the rest to the recipient as compensation.
But it turns out that the law there is like that.
And really still surprised by the words of free money.

And what makes difference with what happens to Bitcoin or cryptos that are sent to the wrong address and are lost?
It is no different then. The difference is probably that the recipient is "known and unknown".

SquallLeonhart

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Quote from: bits4books on February 20, 2021, 05:10:44 AM

If your pencil does not write well - do you buy a new one or sharpen your own / insert a new rod?

The problem with Citibank is that their program had the most disgusting interface, which is also very easy to mistake. The main problem is not that Citibank made a mistake and now can not return the money, but that Citibank MADE a MISTAKE BECAUSE OF the SHITTY DESIGN OF ITS OWN SOFTWARE and this must be understood.

Inventing another useless altcoin in order to fix this is shooting a cannon at sparrows. It is enough to bring a normal approach to the design of internal software so that such mistakes do not happen again.

Well shooting cannons at sparrows could work though, it could be overkill and useless to make it that high end, but it still is a working solution isn't it? Yeah you are right they could upgrade their system and have a much much better version of it, but why improve x2 when you can improve 100x ?

I believe if these companies finally manage to remove all these server required idiotic old timer stuff and replaced it with their own blockchains and made it work properly, they could actually get to a new world standard that was incredible.

It would be fast, it would be cheap and it would make 900+ million dollars go from one place to another in a few minutes at most. It would make it harder to reverse that of course but it would at least be simple to not mistake who will get the money, just take a look at the wallet address and you would know it.

bits4books

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If your pencil does not write well - do you buy a new one or sharpen your own / insert a new rod?

The problem with Citibank is that their program had the most disgusting interface, which is also very easy to mistake. The main problem is not that Citibank made a mistake and now can not return the money, but that Citibank MADE a MISTAKE BECAUSE OF the SHITTY DESIGN OF ITS OWN SOFTWARE and this must be understood.

Inventing another useless altcoin in order to fix this is shooting a cannon at sparrows. It is enough to bring a normal approach to the design of internal software so that such mistakes do not happen again.

Karartma1

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Quote from: Bitcoins101 on February 19, 2021, 01:47:54 AM

See, this is why we need the banking system to be run on Ethereum. It is crazy that the banks, out of all organizations, are using payment mechanisms without built-in bailout capabilities.

Ethereum can never be good for that.
This is a simple IT management problem as the banking IT infrastructure is a dinosaur that needs to be rebuilt from the ground.

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Quote from: Lorence.xD on February 19, 2021, 05:02:07 AM

Quote from: amishmanish on February 18, 2021, 12:00:28 AM

Seriously though, this does give a peek into the complexity and outdated-ness of the softwares that run world finance. Its funny how the bloomberg chat ultimately worked to the benefit of Revlon. "No jokes for one whole day". LOL

That really depends, if the company is a private one, I think that it will be up to date but if it is in any way connected to government, it will have a problem being up to date. But you are right, their system is old, it's just packaged differently so people think that they are getting something new when it was the same thing. It was Citi's error if I may be honest, they did initiate the transaction and there should be some steps before they could send that amount of money to somewhere, Citi has to face the music even if it is not sang for them.

It is not easy to make a software in a highly sensitive world as well, we should remember that. Think about the "charts" and exchanges you see, they are rarely any different, we are looking at swaps right now and how they are so different, so simple, so elegant, sure they do not have the details of exchanges but it shows how simple things could be when you want to exchange one coin to another, whereas exchanges are all looking same, the buys and sells and market or limit and many other things, put all exchanges side by side and you will not see too much difference.

If you think something like that exists in crypto with exchanges that are 2-3 year old at most, think about how hard it is to change trillion dollar investment companies software systems to something better. Which is why it is obvious that we should probably not really see them as "old and failed" systems but more like "difficult to replace" systems.

Vatimins

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The lesson here is that nothing is safe from error. Errors or mistakes are bound to happen to anyone. Even the highest standards aren't full proof. Too bad for those that make mistakes like this. Specially in this place. Only thing left to do is beg for it or cry over it and move on. A person would have to be in such a hurry or too tired/stressed to make an error such as this one. I wonder if the case would still be the same if the amount was way bigger and the people involved are very rich personalities.

stompix

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Quote from: el kaka22 on February 19, 2021, 07:59:01 AM

I mean you could always have charge backs and so forth in fiat money, you could buy something with credit card and then do a charge back, that has been a problem for many shop owners for years and years,

And with cryptos, there will be a problem for consumers for years to come.
Look at the hundreds if not thousands of shops claiming to sell mining gear right now only for crypto, what can all those do? Nothing!
No chargebacks are good for sellers, chargebacks are good for buyers, there is simply no way payment method that will make both of them happy.

Let's be honest about it, if you come across a new website with a great deal and you have two options CC or BTC I'm willing to bet even if from the users on this forum 95% will choose a credit or debit card.

Quote from: el kaka22 on February 19, 2021, 07:59:01 AM

so you sell something for 100 dollars, which costs you 50 bucks, and you think you made a profit of 50 dollars right? Buyer makes a chargeback, so paypal withdraws that 100 bucks from you and 100 bucks for blockage and now you are down 250 bucks for something you sold to someone.

You sold something for 100$ that cost you 50$. You're on profit $50!
Paypal comes with a chargeback and hits you with a 200$ fee, you're down to $150, not $250.

el kaka22

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Quote from: davis196 on February 18, 2021, 03:03:10 AM

So,at the end of the day,fiat transactions aren't always reversible,are they? Grin

This is what I call "financial bureaucracy". Grin

Many people think that the biggest banks would have the best software and the best employees at their disposal,but the reality is that even the biggest banks want to outsource and try to cut their costs,so their clerks aren't the best and their software is "not-so-good"...
Anyway,that was one horrible wall of text to read. Grin

Maybe we should create some memes about this accident.

Sort of? I mean you could always have charge backs and so forth in fiat money, you could buy something with credit card and then do a charge back, that has been a problem for many shop owners for years and years, specially with paypal who took out even double sometimes, so you sell something for 100 dollars, which costs you 50 bucks, and you think you made a profit of 50 dollars right? Buyer makes a chargeback, so paypal withdraws that 100 bucks from you and 100 bucks for blockage and now you are down 250 bucks for something you sold to someone.

Basically this is a HUGE deal and that is why it was different, nobody could say that citi was wrong here, they did a mistake and that is true but just because they did a mistake doesn't mean that they should be out 400 million dollars from this, they should have gotten their money back, it is an insane case and not something common in fiat world.

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Quote from: amishmanish on February 18, 2021, 12:00:28 AM

Seriously though, this does give a peek into the complexity and outdated-ness of the softwares that run world finance. Its funny how the bloomberg chat ultimately worked to the benefit of Revlon. "No jokes for one whole day". LOL

That really depends, if the company is a private one, I think that it will be up to date but if it is in any way connected to government, it will have a problem being up to date. But you are right, their system is old, it's just packaged differently so people think that they are getting something new when it was the same thing. It was Citi's error if I may be honest, they did initiate the transaction and there should be some steps before they could send that amount of money to somewhere, Citi has to face the music even if it is not sang for them.

orions.belt19

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Flexcube is a very outdated software, it goes way back to the 90s and is prone to many tech errors plus it crashes very often. (I had some experience using it) This is why there is a maker-checker system in order to mitigate human errors however this is sometimes not enough, as proven in this unfortunate event. I understand why they first attempted to address the situation to tech support, during my time using it we had to consult with tech about three times in a week. And the thing about using flexcube is there is no fallback or safety system once the action has been done. A similar situation happened in the past where "primary" was ticked instead of only "settlement" and just like that, all of the money got out. The money was returned though but the fault was on the operations team who erroneously ticked the wrong boxes. Its kind of scary to think how ticking of wrong boxes could lead to lost of millions and even with checkers and quality team looking out. You would think Citi should at least opt for a new system considering how outdated Flexcube already is and it potentially would cost them millions on human error for simple things like ticking the wrong boxes.

Bitcoins101

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See, this is why we need the banking system to be run on Ethereum. It is crazy that the banks, out of all organizations, are using payment mechanisms without built-in bailout capabilities.

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Quote from: so98nn on February 18, 2021, 09:38:20 AM

The Citigroup Guys must be on weed that day. Unbelievable, how could they possibly make a mistake of sending 900 million. That’s a shit thing man. A banker like that might have been fired by now. Lolz.

Well, if we bring up idea like lending protection through altcoin then it wouldn’t be that popular as you may think. It’s basically securing your data permanently over blockchain and showing the proof of transaction or amount or other details. But it doesn’t mean we will have securities against loan process.

Accidentally sent money is simply human error or in rarest case technological mistake. You can’t do anything for these errors. You can just improve them.

Making a whole dam tech stuff for avoiding such complications would bring more complications. Tongue

Whatever they are smoking that day, I want one Grin

. The problem with this is both human and technical incompetence, if they were hiring people that are competent then this kinds of error wouldn't have been overlooked and in the technical side, if they don't want this kind of error then they should've created a far superior system to cover the possibility of technical errors. It is not the technology that is complicated, it is the people that are using it, they want to make more money so they make the process more complicated.

so98nn

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The Citigroup Guys must be on weed that day. Unbelievable, how could they possibly make a mistake of sending 900 million. That’s a shit thing man. A banker like that might have been fired by now. Lolz.

Well, if we bring up idea like lending protection through altcoin then it wouldn’t be that popular as you may think. It’s basically securing your data permanently over blockchain and showing the proof of transaction or amount or other details. But it doesn’t mean we will have securities against loan process.

Accidentally sent money is simply human error or in rarest case technological mistake. You can’t do anything for these errors. You can just improve them.

Making a whole dam tech stuff for avoiding such complications would bring more complications. Tongue

(Also, is that Citigroup team fired yet ? ) Grin

dothebeats

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Citi doesn't have a claim on that one because they are about to give that money to the same recipients anyway. If anything, they can sue the people that did the transfer from their ranks for mishandling funds. Other than that there's really no chasing about that money. If some of those money ended up in parties that weren't even concerned with the said agreement, that's lucky for them considering that they received basically free money from the errors of a software and the team who operated it at Citi.

Vishnu.Reang

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The money was owed to the recipients and that is the reason why they don't need to pay it back. It's not like they got some handout from Citi. Perhaps that is the reason why the courts also ruled that the money doesn't need to be wired back. In the end, it is Citi's fault that they can't find literate people to handle such a huge amount. In most of the corporations, if you need to move a small fraction of that amount, you need to go through multiple levels of authorization and verifications. If Citi doesn't have such a system, then it is their fault.

Topic: Citi Can’t Have Its $900 Million Back (Read 262 times)