Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

Flash crash set off by ‘fat-fingered’ Citigroup trader could cost $50m

Flash crash set off by ‘fat-fingered’ Citigroup trader could cost $50m

Details emerge after London-based employee incorrectly added a zero to a transaction
A “fat-finger error” by a London-based trader at Citigroup that triggered a flash crash across European stock markets could cost the bank at least $50m (£39.8m).

The trader was working from home last month when they incorrectly added an extra zero to a trade, Bloomberg reported, quoting “people familiar with the matter”.

That split-second mistake, on the 2 May bank holiday, wreaked havoc on markets across Europe, triggering a sell-off that reportedly wiped out as much as €300bn (£256bn) at one point.

Trading was briefly suspended in several markets that morning after leading share indices recorded sudden steep declines.

One of the hardest hit was Sweden’s benchmark OMX Stockholm 30 index, which fell by nearly 8% but later recouped most of the losses and ended the day 1.9% lower.

The Stoxx Europe 600 index of Europe’s leading shares lost as much as 3% before closing down 1.5%.

Even though the error was made by a London-based trader, the UK stock market escaped that day’s carnage as it was closed for the bank holiday.

Flash crashes, or brief price collapses, can be caused by human error. Although many aspects of trading have been digitised and automated, parts of the process are still manual, leaving room for such error. So called fat-finger blunders – where the details of a trade are mistyped – have become more common with the rise of high-frequency trading firms.

Until now, few details had emerged about last month’s incident. New York-based Citigroup owned up to the mistake in a statement a few hours later, saying: “This morning one of our traders made an error when inputting a transaction. Within minutes we identified the error and corrected it.”

Bloomberg has uncovered more since. It reported that the bank may record a loss of at least $50m after the incident, though work was still being done on this and the final figure may be higher.

It said the trader was part of the firm’s Delta One trading unit in London and had since been placed on leave while the bank reviewed the incident.

UK regulators are likely to have taken an interest, and the fact that the trader was working from home may be a focal point of any investigation.

However, the report quoted insiders as saying Citigroup took the view that it was human error unrelated the fact the staffer was working from home.

The Delta One unit sells financial products to sophisticated investors such as pension funds, hedge funds and blue-chip corporate clients.

Citigroup has past form. In 2020 it accidentally wired $900m of its own money to creditors of the cosmetics group Revlon.

One of the biggest flash crashes happened on 6 May 2010 when the Dow Jones on Wall Street lost almost 9% of its value within minutes and hundreds of billions of dollars were wiped off share prices.

A spokesperson for Citigroup declined to comment.
AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
Chinese Stock Market Rally Fueled by Domestic Investors
Israeli Airstrike in Yemen Kills Houthi Prime Minister
Ukrainian Nationalist Politician Andriy Parubiy Assassinated in Lviv
Trump Administration Seeks to Repurpose $4.9 Billion in Foreign Aid
Corporate America Cuts Middle Management as Bosses Take On Triple the Workload
Parents Sue OpenAI After Teen’s Death, Alleging ChatGPT Encouraged Suicide
Amazon Faces Lawsuit Over 'Buy' Label on Digital Streaming Content
US Appeals Court Rules Against Most Trump-Era Tariffs
Germany’s Auto Industry Sheds 51,500 Jobs in First Half of 2025 Amid Deepening Crisis
Bruce Willis Relocated Due to Advanced Dementia
French and Korean Nuclear Majors Clash As EU Launches Foreign Subsidy Probe
EU Stands Firm on Digital Rules as Trump Warns of Retaliation
Getting Ready for the 3rd Time in Its History, Germany Approves Voluntary Military Service for Teenagers
Denmark Confronts U.S. Diplomat Over Covert Trump-Linked Influence in Greenland
Trump Demands RICO Charges Against George Soros and Son for Funding Violent Protests
Taylor Swift Announces Engagement to NFL Star Travis Kelce
France May Need IMF Bailout, Warns Finance Minister
After the Shock of Defeat, Iranians Yearn for Change
Ukraine Finally Allows Young Men Aged Eighteen to Twenty-Two to Leave the Country
The Porn Remains, Privacy Disappears: How Britain Broke the Internet in Ten Days
YouTube Altered Content by Artificial Intelligence – Without Permission
Ukrainian Refugee Iryna Zarutska Fled War To US, Stabbed To Death
Elon Musk Sues Apple and OpenAI Over Alleged App Store Monopoly
German Chancellor Friedrich Merz: “The Current Welfare State Can No Longer Be Financed”
HSBC Switzerland Ends Relationships with Over 1,000 Clients from Saudi Arabia, Lebanon, Qatar, and Egypt
Sharia Law Made Legally Binding in Austria Despite Warnings Over 'Incompatible' Values
Dutch Foreign Minister Resigns Amid Deadlock Over Israel Sanctions
Trump and Allies Send Messages of Support to Ukraine on Independence Day Amid Ongoing Conflict
China Reels as Telegram Chat Group Shares Hidden-Camera Footage of Women and Children
MotoGP Cameraman Narrowly Avoids Pedro Acosta Crash at Hungarian Grand Prix
Wizz Air passengers screamed as storm-battered flight diverts to Bologna
European postal services halt U.S. deliveries after Trump imposes new tariffs
Urban explorer finds abandoned luxury restaurant left to decay
Fidesz leader labels Péter Magyar a ‘bluffer’ amid escalating political spat
French rope park operator arrested for denying entry to Israeli children
Újpest thrashes Zalaegerszeg 4-1 to secure first win in five matches
Profit-margin cap costs retailers 13 billion forints a month, warns trade group
Curiosity rover finds coral-like rock on Mars hinting at watery past
U.S. green policy rollback drives investors to Europe’s sustainable finance market
Special funerals rise in Hungary: boat, aerial and forest burials gain popularity
Hungary’s Kiskunság region turning into semi-desert after extreme drought
Kopasz Bálint wins world kayak 1000 m title in Milan, making him triple world champion
Budapest’s Keleti railway station to close for four weeks for track overhaul
Balaton could be unfit for swimming by 2035 and dry by 2050, scientists warn
Leaked guidelines show Meta’s AI allowed flirty and racist interactions with children
Filming of ‘Emily in Paris’ halted after assistant director dies on set
Filipino guest workers sue after Hungary moves to deport them for pregnancy
Ukraine Declares De Facto War on Hungary and Slovakia with Terror Drone Strikes on Their Gas Lifeline
A monster hit and a billion-dollar toy empire
Animated K-pop Musical ‘KPop Demon Hunters’ Becomes Netflix’s Most-Watched Original Animated Film
×