NYSE Regulation has censured and fined 14 member firms and one former member firm a total of US$10.425 million. The disciplinary action is the result of an industry-wide review of prospectus delivery procedures.

The firms’ violations include failures to ensure delivery of prospectuses to customers who purchased securities and mutual funds, to deliver product descriptions to customers who purchased exchange traded funds, and to establish and maintain appropriate procedures of supervision and control with respect to these activities. Two of the firms also failed to ensure delivery of certain documents to customers, such as trade confirmations.

The individual fines ranged from US$375,000 to US$2.25 million. In addition, each firm member agreed to certify that its current policies and procedures are reasonably designed to ensure compliance with the current federal securities laws and NYSE rules in these areas.

Citigroup Global Markets Inc. received the largest fine. Deutsche Bank Securities Inc. and Lehman Brothers Inc. each received US$1.25 million fines.

The other firms sanctioned include: UBS Securities LLC, Bear, Stearns & Co., Inc., Credit Suisse Securities (USA ) LLC, Citigroup (as successor to Legg Mason Wood Walker, Inc., McDonald Investments Inc., RBC Dain Rauscher, Inc., UBS Financial Services, Inc., Banc of America Securities LLC, Goldman, Sachs & Co., JP Morgan Securities Inc., Keefe, Bruyette & Woods, Inc. and Wachovia Capital Markets LLC.

“When you are evaluating an investment, access to appropriate disclosure documents, including an accurate description of the risk involved, is extremely important,” said Richard Ketchum, chief executive officer, NYSE Regulation, Inc., in a news release. “During the time in question, these firms did not have adequate controls in place to carry out their responsibilities to their customers.”

Enforcement conducted this review after it learned in other investigations that prospectuses were not being sent to customers as required by federal securities laws and NYSE rules.