A New York investment advisor, its owners and its chief compliance officer have been suspended from the industry and will pay over $1 million in total penalties after allegedly violating the U.S. Securities and Exchange Commission’s custody rule for the second time in six years.

In an administrative proceeding, the SEC charged Sands Brothers Asset Management, co-founders Martin and Steven Sands, and former CCO Christopher Kelly with being repeatedly late in providing audited financial statements of the firm’s private funds to investors.

The SEC’s custody rule requires firms to obtain an independent verification of assets when they can access or control client money or securities to ensure investors that they are protected from misuse or theft.

In 2010, Sands Brothers and Martin and Steven Sands agreed to pay a $60,000 penalty to settle an enforcement action charging them with violations of the custody rule.

“There is no place for recidivism in the securities markets,” said Andrew M. Calamari, director of the SEC’s New York regional office, in a statement on Thursday. “The Sands brothers missed their opportunity to right a previous wrong and instead merely repeated their custody rule violations, so now they face more severe consequences.”

As part of the settlement, the firm and both Sands agreed to pay a $1 million penalty and will be suspended for a year from raising money from new or existing investors. Kelly will pay a $60,000 penalty and is suspended for one year from acting as a CCO or practicing before the SEC as an attorney.

According to the SEC's order, Sands Brothers Asset Management had $64 million as of July 2014.

By consenting to the SEC’s order, the firm, the Sands and Kelly neither admitted to nor denied charges that they willfully aided or abetted the firm’s violations.