Citigroup Inc.'s London trading desk was behind a "flash crash" that sent shares across Europe tumbling, dealing a fresh setback to the bank's years-long efforts to improve controls.
A trader at the U.S. firm made a mistake "inputting a transaction," Citigroup said late on Monday after a knee-jerk selloff in Swedish stocks in five minutes wreaked havoc in bourses from Paris to Warsaw. The bank said it identified the error "within minutes" and corrected it.
The violent reaction saw the main European index lose as much as 3 percent, wiping out 300 billion euros (US$315 billion) at one point. It revived questions around how large financial firms can prevent such errors, and whether markets have sufficient safeguards in place.
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