Multimillion-dollar banking mistake: who should recover the lost millions?
The dispute between VTB Bank and U-Profit began after VTB Bank mistakenly credited money from the EFKO-Cascade Coordinating Distribution Center account to the account of another firm with the same name in 2021. In 2022, U-Profit tried to recover unjust enrichment from the real recipient, but this failed due to the debtor's lack of property. They then filed a claim against VTB Bank for damages, and the Court of Appeal upheld their claims. The court indicated that the bank should have either transferred the money to the correct account or refused to execute the order.
ASGM decided that the bank had correctly executed the payment order, because at the time of the transaction, there was no requirement that the bank should take into account the TIN when transferring the TIN — this recommendation from the Central Bank for banks appeared later. The appeal overturned the decision and upheld the claim, stating that the bank that accepted the payment order to transfer the transfer to a legal entity with a specific TIN is obliged to transfer money to that particular legal entity or indicate that the payment order does not meet the established requirements.
Anna Udod-Podshivalova, Senior Associate in the Banking and Financial Law Practice at Versus.legal, in her comments for Pravo.ru notedthat banks are professional market participants who are fully aware of the intricacies of banking processes, including such as money transfers.
“That is why expecting additional checks and other actions from them aimed at the correct execution of a payment order is a reasonable behavior.”
Anna separately highlighted that individuals and legal entities cannot fully understand the procedural and regulatory features of banking. In this regard, our expert expects the Supreme Court to cancel the cassation decision and “uphold” the decision of the 9th AAC in this case.
The full version of the article is available at: Pravo.ru