The British broadcaster was found to have committed a "serious breach" of industry standards by failing to disclose that the narrator of a documentary about the Gaza conflict was the offspring of a Hamas official, as determined by British broadcasting authority Ofcom.
An probe by Ofcom into the programme Gaza: How to Survive a Warzone has found that the film was "substantially inaccurate".
The head of the BBC had already issued an apology, stating there had been "a serious error in relation to accuracy".
The regulator has directed the BBC to air a prime-time declaration about its conclusions.
"Since this amounts to a serious breach of our regulations, we are instructing the corporation to air a message of our findings against it on BBC2 at 9pm, with a date to be determined," the statement read.
'Risk to Damage Trust'
The regulator's statement said: "The inquiry we conducted found that the documentary's omission to reveal that the narrator's parent occupied a post in the Hamas-run government was substantially inaccurate.
"This implied that the audience did not have essential details which may have been very significant to their judgment of the presenter and the details he presented.
"Credibility is at the heart of the connection between a media organization and its viewers, particularly for a national broadcasting corporation such as the British Broadcasting Corporation.
"This failing had the possibility to undermine the significantly high amounts of credibility that viewers would have put in a documentary produced by the BBC about the Gaza conflict."
The film was withdrawn from the online platform in February after the boy's personal associations came to light, and in July an corporation's own inquiry determined it violated the broadcaster's journalistic standards on accuracy.
A corporation official stated: "The regulator's decision is in agreement with the conclusions of Peter Johnston's review, that there was a serious error in the programme in relation to the corporation's content standards on accuracy, which reflects clause 2.2 of Ofcom's Broadcasting Code.
"We expressed regret for this and we agree with the authority's determination in complete. We will follow the penalty as soon as the timing and language are determined."
