The New York Stock Exchange is fining Merrill Lynch $10 million for failing to deliver mutual fund prospectuses. Merrill failed to deliver the reports in at least 64,000 transactions for the sales of registered, open-end mutual fund securities. Merrill also failaed to deliver prospectuses in 900 transactions in 275 accounts related to auction-rate preferred stocks between January and July in 2004, NYSE charged.

The error occurred due to a change Merrill had made to its back-office systems in 2002, which the firm discovered through an internal audit and reported to Big Board in October 2004.

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