Last year, a surprising mistake occurred at Citigroup when an employee accidentally transferred an enormous amount of money into a customer’s account. Instead of sending a modest amount of $280, the employee mistakenly credited the account with an unbelievable $81 trillion. This mistake, reported by the Financial Times, would have meant that the customer would have been the richest person in history.
To put this amount into perspective, Citigroup itself has a total market value of around $150 billion. In comparison, the entire Gross Domestic Product (GDP) of the United States is about $27 trillion, and the GDP of the European Union is around $17 trillion. Even China’s GDP is close to $18 trillion. So, the amount that was mistakenly transferred was more than the entire worth of many developed countries combined. Fortunately, no money actually left the bank, and the customer was not able to keep the funds, as they never truly existed.
The situation raised questions about whether the employee who made the mistake kept their job. Citigroup referred to this event as a “near miss” when communicating with the Federal Reserve and the Office of the Comptroller of the Currency. This term likely downplays the severity of what happened. In fact, this incident did not lead to any funds being lost, according to reports.
The phrase “near miss” refers to instances when banks mistakenly process the wrong amounts, but manage to recover the funds before any real damage is done. According to internal reports shared with the Financial Times, Citigroup experienced 10 such near misses involving amounts of $1 billion or more last year, although this number was slightly lower than 13 from the previous year. One significant aspect of near misses is that they do not have to be reported to regulatory bodies, meaning there isn’t a clear picture of how often these incidents occur in the banking industry. Some former regulators have stated that near misses involving such large amounts are rare among U.S. banks.
In this particular incident at Citigroup, it was automated systems that stopped the incredibly large transfer, after two employees failed to notice the mistake. About 90 minutes after the transfer began, a third employee finally realized there was a problem. Citigroup explained that while such a large payment could not have been processed, their detection controls quickly identified the input error that occurred between two internal accounts, allowing them to reverse the transaction.
Citigroup has had its share of significant blunders in the past. For example, about two years prior to the $81 trillion error, an accounting mistake related to a trade led to a massive sell-off of stocks in Europe, resulting in a loss of approximately $322 billion in value. Because of this incident, Citigroup faced a fine of $79 million for causing such substantial disruption in the market.
Gizmodo has reached out to Citigroup for a comment and will provide updates if the bank responds.