Fifteen broker-dealer firms will pay $13m (€10.1m) in combined penalties to settle charges of violations in the auction rate securities market for municipal and corporate bonds.

According to the Securities and Exchange Commission, firms including Bear Stearns, Goldman Sachs and Citigroup favoured some customers over others in the $200bn market for auction-rate bonds. The SEC said that between January 2003 and June 2004, the 15 firms allowed certain customers to change their orders in the blind auctions. The firms also intervened in auctions by bidding for a firm's proprietary account and also provided certain customers with information that gave them an advantage over other customers in determining what rate to bid.