A number of major US banks have been fined a total of $4.5 million after being accused of paying lobbyists using municipal and state bond funds.
The Financial Industry Regulatory Authority (Finra) revealed five lenders - Citigroup, JP Morgan, Merrill Lynch, Goldman Sachs and Morgan Stanley - will need to pay the sums in order to settle these claims, the Associated Press reports.
According to the regulatory agency, the five financial institutions made payments to Cal PSA, a California business lobbying group, between 2006 and 2010.
Finra - which has 20 regional offices around the US and employs around 3,300 people - claimed the banks asked for these payments to be reimbursed as underwriting expenses taken from the money made through municipal and state bond offerings.
In addition, it has been alleged that the financiers broke fair dealing and supervisory regulations by failing to adequately disclose to issuers just what these fees were comprised of.
By Claire Archer