For 2-1/2 years, this New York broker-dealer allegedly failed to deliver official statements by settlement date to numerous customers who purchased new issue municipal securities and could not provide evidence that it delivered official statements ("OS") in final form. Rice Securities, LLC - dba Rice Financial Products Company - is a full service municipal investment banking firm and a FINRA member firm since 1988.  It's headquartered in New York City, has 9 branch offices and employs 38 registered persons. FINRA's Allegations. Rice allegedly failed to deliver official statements by the settlement date to numerous customers - typically institutional investors that purchased new issue municipal securities during the primary offering disclosure period.  In all cited transactions, Rice was neither an underwriter nor part of the underwriting syndicate, but nevertheless was required to deliver an official statement to each customer by the settlement date. It turned out, the firm had contracted this responsibility to a 3rd-party vendor.  The vendor, however, failed to keep a contemporaneous record of the transaction that included:  (i) customer’s name; (ii) description of the security;  (iii) settlement date;  (iv) type of disclosure sent;  (v) date the disclosure was sent;  (vi) name of person(s) sending the disclosure. The firm also allegedly failed to conduct a review to determine whether the 3rd-party vendor carried out the functions the firm assigned to it, as MSRB Rule G-8(a)(xiii) required.  It was further noted that Rice also failed to adopt, maintain and enforce WSPs reasonably designed to ensure compliance with MSRB Rules G-8 and G-32.  FINRA noted that the firm's WSPs did not address the use and supervision of an outside vendor, how the records of the outside vendor are to be reviewed, or who at the firm was responsible for ensuring this procedure is being followed.[Supervisory elements: Who, What, When Where and How.] The firm started including a notice on confirmations that customers could access their official statement electronically, but its WSPs were not updated for this new process until almost a year later.  Finally, the firm allegedly did not implement and enforce certain procedures it had in place specifically pertaining to its obligations to deliver official statements to customers and its obligation to maintain various records pertaining to its delivery of official statements to customers who purchased new issue municipal securities. FINRA Sanctions. Rice Securities was fined $50,000.   For further details, go to:   [FINRA AWC #2010023765101].   [Disciplinary Actions for October 2011.]