Citigroup made a costly mistake last year when it accidentally credited a customer’s account with $81 trillion instead of the intended $280. The error, which occurred in April, went unnoticed by two employees but was rectified 90 minutes after it was discovered. The Financial Times was the first to report on the incident, which was promptly reversed and reported to regulatory authorities as a “near miss.”
This mishap is just the latest in a series of operational errors that Citigroup has faced in recent years. The bank has been working diligently to overcome these challenges and improve its risk management and control processes. In a statement to NBC News, Citigroup acknowledged the error and highlighted the importance of its detective controls in identifying and rectifying such mistakes.
Near misses, like the one experienced by Citigroup, occur when a bank processes the wrong amount but is able to recover the funds before any significant damage is done. According to reports, Citigroup experienced 10 near misses of $1 billion or more last year and 13 the year prior.
The bank’s reputation took a hit in 2016 when it mistakenly sent $900 million to creditors involved in a dispute over the debt of cosmetics group Revlon. This incident led to the departure of former CEO Michael Corbat and resulted in hefty fines and regulatory orders for Citigroup to address its operational shortcomings.
Current CEO Jane Fraser has made improving risk management and controls a top priority for the bank. Despite ongoing efforts to address these issues, Citigroup was fined $136 million by regulators last year for not making sufficient progress in implementing necessary improvements.
As Citigroup continues to focus on automating controls and eliminating manual processes through its Transformation initiative, it remains committed to preventing future errors and upholding the trust of its clients and regulators.
