Citigroup made a massive mistake last April when it mistakenly transferred $81 trillion into a customer’s account, instead of the intended $280, according to a Financial Times report. The error went unnoticed by two employees for about 90 minutes before it was flagged by a third employee. Fortunately, no funds were actually transferred out of the bank, and the incident was categorized as a “near miss” by the Federal Reserve and the Office of the Comptroller of the Currency.
A Citigroup spokesperson explained the situation, saying, “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.” The spokesperson also confirmed that “Our preventative controls would have also stopped any funds leaving the bank.” They assured that the incident did not impact either the bank or its client.
According to the report, Citigroup had 10 other near misses involving transactions of $1 billion or more last year. While this is a decrease from 13 such cases the previous year, it is still considered highly unusual in the U.S. banking industry to have near misses involving sums greater than $1 billion.
This mistake highlights the importance of robust checks and balances in banking systems, as such errors could lead to significant financial and reputational risks.
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