London Welsh have been deducted five points and fined £15,000 for fielding an ineligible player in the Aviva Premiership.
The Rugby Football Union also imposed a further five-point penalty suspended until the end of the 2013-14 season over appearances made by Tyson Keats.
As a result of the ruling, Welsh, who swiftly confirmed they will launch an appeal, now sit rock-bottom of the Premiership two points adrift of struggling Sale Sharks.
The Rugby Football Premiership regulations panel were told that 31-year-old scrum-half Keats made 10 appearances in the league without holding the requisite registration.
Panel chairman Jeremy Summers said afterwards: "This was an extraordinary case, and one that it is hoped will never be repeated.
"The sanction imposed was structured to reflect the seriousness of the matter, which included conduct that was dealt with by the police, but also to import a rugby-based proportionality to the overall position that took into account the wider interests of the game."
London Welsh's former rugby manager Mike Scott is the subject of a separate RFU disciplinary invesigation into Keats' appearances.
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