We all make mistakes in the job, but one Citigroup banker committed an astounding error that may have been the largest ever seen on Wall Street.
Last April, Citi unintentionally authorized a $81 trillion payment when transferring $280 to a client's account as part of a rather routine bank transfer.
Luckily, 90 minutes after the payment was sent, the problem was discovered. Reversing the transaction took several hours, but fortunately, no money was lost or left the bank.
False payout highlights Citi's operational problems However, the blunder served as yet another reminder that Citi still has a number of operational problems to fix. The bank accidentally sent $900 million to Revlon's creditors in August 2020 rather than paying interest.
In that case, the phantom payment was the result of a software error. These types of errors are common in the finance industry, and they usually result in the detection of the problem and the return of the defective payout, so no harm is done.
Brigade Capital, Symphony Asset Management, and HPS Investment Partners, the creditors, declined to do so this time.
The legal dispute that resulted from it was resolved out of court in December 2022. Citi lost $323 million in fourth-quarter profits as a result of the blunder, and CEO Michael Corbat lost his job.
According to an internal report seen by the Financial Times, Citi identified 10 similar near-misses of $1 billion or more in 2024.