Citigroup Inc. mistakenly credited a staggering $81 trillion to a customer’s account instead of the intended $280 in April last year, before swiftly correcting the error within hours, according to a report by the Financial Times.
The enormous miscalculation, which briefly made the client the world’s richest individual on paper, was overlooked by two employees before a third detected the mistake approximately 90 minutes after it was processed. Fortunately, no actual funds left the bank, and Citi classified the event as a “near miss” in its disclosure to the Federal Reserve and the Office of the Comptroller of the Currency.
Error detected before any funds left the bank
Despite the eye-watering sum involved, Citi was quick to reassure stakeholders that its internal safeguards effectively prevented any real financial consequences.
A spokesperson for the banking giant stated:
“Despite the fact that a payment of this size could not actually have been executed, our detective controls promptly identified the inputting error between two Citi ledger accounts and we reversed the entry. Our preventative controls would have also stopped any funds leaving the bank.”
The statement also confirmed that neither the bank nor the client suffered any financial impact as a result of the mistake.
A pattern of “near misses” at Citi
While such an astronomical error may seem extraordinary, it was just one of several high-value mistakes that occurred at Citi last year. According to the Financial Times, the bank reported 10 instances of “near misses” involving amounts exceeding $1 billion in 2023. Though this figure was down from 13 in the previous year, such incidents remain rare across the US banking sector.
The frequency of these errors raises concerns over Citi’s internal risk management and operational oversight, particularly given the scale of its global operations. While the bank has emphasised that its detection and preventative controls remain robust, such high-value miscalculations highlight the potential risks posed by human error in financial transactions.
Not Citi’s first high-profile banking error
This latest blunder comes as Citi continues to recover from a series of costly mistakes in recent years. In 2020, the bank mistakenly wired $900 million to a group of lenders involved in Revlon’s debt financing, a case that ended in legal battles after some recipients initially refused to return the funds.
Instances like these have placed increasing pressure on Citi to improve its risk controls, particularly as regulatory bodies continue to scrutinise operational mishaps in the banking sector.
What this means for banking security
While Citi was able to correct this particular error before it had any material impact, the incident underscores the importance of stringent internal controls in the financial industry. Given the vast sums handled by major banks daily, even minor inputting errors can result in eye-catching mistakes with significant potential consequences.
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Financial experts argue that banks must continue investing in automation and artificial intelligence to minimise the risk of human error in high-value transactions. Enhanced oversight, improved employee training, and stricter verification processes may also be necessary to prevent similar incidents in the future.
Despite these concerns, Citi remains one of the world’s largest financial institutions, with extensive risk management measures in place. However, with regulators closely monitoring banking errors of this scale, the company will likely face further scrutiny over its operational procedures in the months to come.
For now, the client who temporarily became the richest person on Earth can only wonder what could have been—had the mistake not been reversed so quickly.
