The comical mistake wasn’t caught by the first employee. Nor the second who was supposed to check it. It took a third Citigroup staffer a full 90 minutes to notice something was deeply wrong. Banking at its finest, folks. The transaction was eventually reversed hours later, with no funds actually leaving the bank. Thank goodness for that.
The error happened due to manual entry between two ledger accounts. Citigroup’s backup system apparently sports a user interface straight out of the 1990s. Modern banking at work! Initially, the system flagged the transaction—not because it was ludicrously large, but for potential sanctions violations. Priorities.
Nothing says cutting-edge finance like archaic UI and systems that worry about sanctions before billion-dollar typos.
For perspective, this error exceeded Citigroup’s entire market capitalization by over 550 times. The mistaken $81 trillion amount was nearly three times larger than the U.S. GDP of $29.72 trillion. It’s one of ten “near misses” over $1 billion the bank has experienced just this year. They’re collecting these incidents like trading cards.
Regulators weren’t amused. The Federal Reserve and OCC were promptly notified, especially since Citigroup is already in hot water. They paid a $400 million fine in 2020 for poor risk management and another $135.6 million this July. Their track record isn’t exactly stellar.
This isn’t their first rodeo with embarrassing errors. In 2020, they accidentally wired $900 million to Revlon creditors. In 2022, they caused a flash crash in European markets by adding an extra zero to a trade. Oops.
CEO Jane Fraser is throwing billions at the problem. They’ve got 12,000 employees working on a “Transformation” project. One suggestion: maybe start with calculator training. The Financial Times first reported this massive accounting blunder, highlighting yet another failure in Citi’s risk controls.
The banking industry as a whole faces similar challenges. But Citigroup seems determined to lead the pack—in mistakes, anyway.
