The BBC Trust ruled today that there had been a series of "serious and repeated" breaches of editorial guidelines in a number of BBC Daytime shows, including faked scenes.
Independent production company Reef Television must now pay compensation to the BBC - which was unaware of the deceit - and an on-air apology is to be broadcast.
BBC1 series such as Sun, Sea And Bargain Spotting and Trash For Cash were among those which the BBC Trust found had misled viewers.
The programmes included production staff being passed off as members of the public while buying items and re-staging events for the cameras. Production staff also bought items which affected on-screen challenges.
Reef was suspended from working for the BBC after the incidents came to light in the summer while the investigation was carried out. Reef admitted that it carried out some of the practices knowingly, but believed they were acceptable.
Richard Tait, chairman of the BBC Trust's Editorial Standards Committee (ESC), said: "The practices identified in Reef Television's programming routinely misled the BBC's audiences and are totally unacceptable."
In the programme Sun Sea And Bargain Spotting, there were seven broadcast incidents of staff posing as members of the public purchasing items.
Two of the cases affected the outcome of the programme, with a different contestant winning the programme as a result of the purchase.
There were also two incidents of re-staging, with one dealer asked to pose as another, and a researcher standing in for a genuine dealer.
A number of off-camera staff purchases which were not transmitted also came to light. These were made during Series 6, for which work was suspended pending the investigation.
Reef Television also disclosed that there were 11 issues of staff purchases in Trash To Cash, deemed to be minor by BBC management.
In a further programme, Dealers: Put Your Money Where Your Mouth Is, there was an incident where a friend stood in for someone who was selling a sofa but did not want to appear on TV.
The BBC said today that it had lifted the suspension on working with Reef Television after the company overhauled the areas which contributed to the breaches.
It said: "Following a rigorous and thorough process, the BBC is now satisfied that the company has compliance procedures and training of an appropriate standard."
The company will continue to work on two existing projects for the BBC and pitch further programmes in future.
The BBC will review Reef's editorial standards performance in six months.
The corporation said it regretted that Reef had "failed to meet the high standards that the BBC expects of all programme makers".
The committee said that, although the programmes were presented as entertainment, licence fee-payers were expecting to see real events unfolding.
It said staff purchases and reconstructions made without explanation to viewers were unacceptable.
The ESC said the incidents resulted from a failure of editorial judgment and editorial control at Reef Television, rather than any failures on the part of the BBC.
The BBC licence fee-payer has also suffered a financial loss as these programmes cannot be shown again on the BBC.
As part of the Trust's ruling, it said the programmes should not be broadcast again.
And those competitors who should have won the shows should be offered an apology and reimbursement by Reef.
The BBC Executive will have to reach a deal with Reef over the level of compensation which must be paid before they will be commissioned - if ever - by the BBC in future.
Mr Tait said: "The Trust takes these breaches extremely seriously: we know they directly undermine the public's trust in the BBC.
"Although they occurred in programming made by a third party, it is ultimately the BBC's responsibility as the broadcaster to make sure that the Editorial Guidelines are adhered to, regardless of a programme's provenance.
"We're satisfied that the outcomes agreed with the Executive reflect the severity of these cases.
"The BBC must not allow its audiences to be misled. It must put steps in place to prevent this and, if misleading material is uncovered, it must be dealt with openly and firmly."
The Trust wants the BBC Executive to work with independent production companies and other programme suppliers to ensure lessons are learned in terms of compliance.