Citigroup erroneously credited consumer account with US$81 trillion

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Citigroup Inc. credited a consumer’s account with US$81 trillion when it meant to ship solely US$280, an error that would hinder the financial institution’s try to steer regulators that it has mounted long-standing operational points.

The faulty inner switch, which occurred final April and has not been beforehand reported, was missed by each a funds worker and a second official assigned to verify the transaction earlier than it was authorised to be processed firstly of enterprise the next day.

A 3rd worker detected an issue with the financial institution’s account balances, catching the fee 90 minutes after it was posted. The fee was reversed a number of hours later, in accordance with an inner account of the occasion seen by the Financial Times and two folks conversant in the occasion.

No funds left Citi, which disclosed the “close to miss” to the United States Federal Reserve and Office of the Comptroller of the Currency, in accordance with one other individual with information of the matter.

The financial institution mentioned its “detective controls promptly recognized the inputting error between two Citi ledger accounts and we reversed the entry” and that these mechanisms “would have additionally stopped any funds leaving the financial institution”.

It added: “While there was no impression to the financial institution or our consumer, the episode underscores our continued efforts to proceed eliminating guide processes and automating controls.”

A complete of 10 close to misses — incidents when a financial institution processes the flawed quantity however is finally capable of get better the funds — of US$1 billion or higher occurred at Citi final yr, in accordance with an inner report seen by the FT. The determine was down barely from 13 the earlier yr. Citi declined to touch upon this broader set of occasions.

Near misses don’t should be reported to regulators, that means there isn’t a complete public knowledge on how usually these incidents happen throughout the sector. Several former regulators and financial institution threat managers mentioned close to misses of higher than US$1 billion had been uncommon throughout the U.S. financial institution business.

The sequence of close to misses at Citi highlights how the Wall Street financial institution is struggling to restore its operational troubles almost 5 years after it mistakenly despatched US$900 million to collectors engaged in a contentious battle over the debt of cosmetics group Revlon Inc.

Citi’s mistaken Revlon payout led to the ousting of then-chief government Michael Corbat, massive fines and the imposition of regulatory consent orders requiring it to repair the problems.

Jane Fraser, who took over as Citi’s prime government from Corbat in 2021, has described fixing Citi’s regulatory points as her “prime precedence.” Still, the group was fined US$136 million final yr by the OCC and Federal Reserve for failing to right issues in threat management and knowledge administration.

Citi’s US$81 trillion close to miss in April was attributable to an enter error and a back-up system with a cumbersome consumer interface, in accordance with folks conversant in the incident. In mid-March, 4 transactions totalling US$280 destined for a buyer’s escrow account in Brazil had been blocked by a display screen that catches funds which might be potential sanction violations.

The fee was rapidly cleared, however nonetheless remained caught within the financial institution’s system and unable to be accomplished usually.

Citi’s expertise staff instructed the funds processing worker to manually enter the transactions right into a not often used back-up display screen. One quirk of this system was that the quantity area got here pre-populated with 15 zeros, which the individual inputting a transaction wanted to delete, one thing that didn’t occur.

© 2025 The Financial Times Ltd

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