Hedge funds shouldn’t be able to keep roughly $500m they were mistakenly paid by Citigroup on a loan owed by now-bankrupt cosmetics company Revlon, a federal appeals court ruled on 8 September.

The US Second Circuit Court of Appeals said a lower court erred in allowing Revlon lenders including Brigade Capital Management, Symphony Asset Management and HPS Investment Partners to retain the “huge windfall” they collected from the bank’s back-office blunder.