Trade monitoring controls at the US investment bank were not robust enough and led to mistakes, explained UK regulators.
Citigroup has been fined £61.6 million (€72.3 million) by UK trading supervisors due to failures in its systems and controls.
The penalties, issued by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA), were linked to issues arising between 2018 and 2022.
In one case, dating back to May 2022, a Citi error provoked a flash crash in European stocks, as $1.4 billion (€1.3 billion) of equities were sold in a “fat-finger” trade.
A Citi trader had intended to sell a basket of equities to the value of $58 million (€53.5 million), but instead accidentally created a basket valued at $444 billion (€409.7 billion).
“Deficiencies in CGML’s trading controls contributed to this incident, in particular the absence of certain preventive hard blocks and the inappropriate calibration of other controls,” the PRA said.
A portion of the trade was blocked by Citigroup’s controls, although $189 billion (€174 billion) worth of shares slipped through the net and $1.4 billion (€1.3 billion) worth of equities were sold across European exchanges before the trader cancelled the order.
The fine from the FCA amounted to around £27.8 million (€32.6 million), compared with the PRA penalty of around £33.9 million (€39.8 million).
Citi agreed to settle the case and, by doing so, qualified for a discount on the fines.
Citi spokesperson Victoria Durman said the bank was “pleased to resolve this matter from more than two years ago, which arose from an individual error that was identified and corrected within minutes.
“We immediately took steps to strengthen our systems and controls, and remain committed to ensuring full regulatory compliance,” she said.