NEW YORK (CNN/Money) - Goldman, Sachs & Co., the New York investment banking powerhouse, has been slapped with a $2 million fine for prematurely hyping and offering to sell shares in certain initial public offerings it underwrote, the Securities and Exchange Commission announced Thursday.

The penalty stems from four IPOs that Goldman Sachs (GS: down $0.95 to $93.21, Research, Estimates) helped bring to market in 1999 and 2000, the federal regulatory agency said. The SEC had accused the Wall Street firm of violating the so-called "waiting period" that precedes a company's stock market debut by offering to sell shares to certain U.S. institutional clients.

In related charges, the federal regulatory agency faulted Goldman Sachs for poor supervision of its Asian trading desk in New York. Traders there allegedly sent "lengthy and detailed e-mails" offering clients the chance to buy shares in the IPOs of PetroChina Company Limited (PTR: down $0.29 to $46.01, Research, Estimates), China Telecom Hong Kong (CHA: down $0.98 to $34.31, Research, Estimates), Chinadotcom Corp. (CHINA: down $0.34 to $7.04, Research, Estimates), and Gigamedia Limited (GIGM: Research, Estimates).

In the case of PetroChina's multi-billion dollar IPO in April 2000, one trader sent out an e-mail to clients heavily touting the company's prospects, according to the SEC. The report called the subsidiary of CNPC, a large Chinese state-owned oil and gas corporation, "a growth story." One section read "Why you should take a goooooood look at PetroChina?"

After one Goldman employee complained, the trading desk took steps to stop the email's distribution and to contact any clients who received it, the SEC said. In a subsequent meeting, however, traders told members of the bank's legal and compliance that they had not been told that written reports like the PetroChina e-mail were prohibited.

The SEC called Goldman Sachs' supervision of its New York Asian trading desk "confusing" and "incomplete."

Goldman Sachs also ran afoul of SEC rules in the PetroChina offering by allowing a senior employee to talk to the Washington Post and other newspapers in response to a controversy that had arisen over the company's looming stock sale, according to the commission.

Some members of Congress, labor unions and public interest groups were threatening to block PetroChina's IPO because its parent, CNPC, had invested in a oil project in Sudan, which the U.S. now sanctions for human rights abuses. Critics, who feared some of the proceeds would be diverted to Sudan, lambasted Goldman Sachs, which stood to reap millions of dollars in fees, for taking part in the controversial offering.

According to the SEC, a senior Goldman Sachs official, after receiving the green light from company lawyers to defend the firm, reassured reporters that proceeds from the offering would be used for domestic projects in China, not in Sudan.

Those statements by Robert Hormats, vice chairman of Goldman Sachs International, who is not named in the SEC papers, violated limits on pre-IPO statements by a company or its advisers, regulators charged.

The pre-IPO hyping by Goldman Sachs came at a time when the economy was booming and a number of Wall Street practices that were commonplace have since come under heavy regulatory scrutiny. The most high-profile investigation to date centered on the conflicts that existed between investment bankers and research analysts who publicly hyped stocks they were privately deriding.

Last year the major Wall Street banks agreed to pay a total of $1.2 billion and to take concrete steps aimed at improving overall compliance and separating banking from stock research.

Other practices that regulators have also targeted include IPO "spinning," in which favored clients were allegedly given shares in hot IPOs, and "laddering," in which investment banks are accused of artificially inflating the value of company's stock to create the frequent one-day pops in share prices.

Representatives for Goldman Sachs did not return a call seeking comment about Thursday's settlement announcement. The agreement says that Goldman Sachs made the settlement offer without admitting or denying wrongdoing.