There are bad financial deals (hello, AOL and Time Warner) and then there are just unfortunate accidents. This week’s $500 million gaffe by Citibank—caused by the wrong box being checked on a form—had us thinking about other historic money accidents.
While the best ways to pay off debt can usually help with many financial blunders, the following cases are notable exceptions. Here are 5 instances that share a special place in history for being among the most expensive financial mishaps of all time.
The most expensive money accidents ever
5. $125 million: Simple math mistake costs NASA big
NASA spent $125 million on its Mars Climate Orbiter, which it designed in 1999 for Lockheed Martin. However, the NASA team used metric measurements in their calculations while the Lockheed team used English measurements for their acceleration data. This simple error caused the craft to malfunction and the probe to become lost in space, where it flew too far into the Martian atmosphere and was later destroyed. The quality control team’s procedures somehow never caught the mistake.
4. $127 million: Man accidentally throws out bitcoin hard drive
IT worker James Howells of the UK used to invest in bitcoin, which he stored on his personal laptop. He began mining in 2009 and estimates that had amassed approximately 7,500 bitcoins. He stopped mining in 2013, broke down his laptop into parts, and sold them on eBay. However, he retained the drive where he stored the bitcoin in the event that they became valuable one day. In 2013, while cleaning his home, he accidentally threw the drive into his local landfill site, where it was immediately buried. Despite asking for permission to retrieve the hardware, the government has refused, noting that attempting to retrieve it could have a detrimental environmental impact to the area.
3. $225 Million: Typo causes Mizuho Securities to bleed money
Mizuho Securities lost 27 billion yen, or $225 million, on a stock trade typo. In 2005, a trader at Mizuho Securities attempted to sell 610,000 shares at 1 yen (which is worth less than a penny) of J-Com Co., a recruiting firm that had just gone public. However, the trader actually meant to sell 1 share at 610,000 yen ($5,041). Even though the number of shares in the trader’s order was 41 times the number of outstanding shares in J-Com, the order was processed anyway.
2. $400 million: Application error costs massive loss in N.J. federal funds
“Race to the Top” was a competitive grant worth $4.35 billion from the U.S. Department of Education, awarded to qualifying K-12 schools. In 2010, New Jersey made a high-profile bid for $400 million of the funding but fell three points short of receiving it due to an administrative error in the application. One of the application’s questions asked for budget data from 2008-2009. However, the administrators used data from 2010-2011 instead, causing the state to receive zero money from the grant.
1. $500 million: Citi checks wrong box, loses insane amount of money
And the dubious honor of most expensive financial accident of all time goes to Citibank (for now). Here’s what happened: Citibank was acting as Revlon’s loan agent and meant to make a small interest payment of $8 million on Revlon’s behalf in 2020. Instead, they accidentally repaid the loan in full—sending $900 million to Revlon’s lenders.The law typically sides with companies who make accidental transfers, but New York has exceptions, known as “discharge-for-value-defense” to this ruling. Citibank filed a lawsuit asking for its funds to be returned, but a judge sided with the creditors, writing that “to believe that Citibank, one of the most sophisticated financial institutions in the world, had made a mistake that had never happened before, to the tune of nearly $1 billion, would have been borderline irrational.” And the worst part? This all happened due to a contractor checking off the wrong box on a digital payment form.
By Stefanie Gordon
Stefanie Gordon is a content strategist with over a decade of professional writing experience. She is a former financial journalist who has spent the last several years working in digital marketing. She specializes in content strategy and creation for large and small businesses in finance and technology.