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Citigroup Fined €12.98 Million In Germany Over ‘Fat-Finger’ Errors

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Citigroup was fined a record €12.98 million in Germany due to a stock sales glitch that caused a major market disruption. 

The fine, issued on May 24, is the highest ever imposed by the financial regulator Bafinin in consumer protection.

The incident occurred in May 2022 when a Citigroup trader made an incorrect entry.

The trader intended to sell securities worth $58 million but mistakenly placed a block of shares valued at $444 billion for sale. 

While the bank's control systems managed to prevent some of the unintended sales, they could not stop all of them. 

As a result, roughly $1.4 billion worth of shares were sold on European exchanges before the trader could cancel the order.

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This error triggered a five-minute sell-off on the OMX Stockholm 30 and caused chaos on exchanges from Paris to Warsaw, temporarily wiping out around €300 billion in market value.

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Despite outsourcing the monitoring and administration of computer trading to London, Citigroup Global Markets Europe AG in Frankfurt remains responsible for the trading system. 

The system failed to detect the error and transmitted erroneous orders, leading to market disruption.

In addition to the Bafin fine, British financial regulators FCA and PRA had already ordered Citigroup to pay a total of £61.6 million (approximately €72 million at the time) in May. 

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