A former broker for Merrill Lynch accused of refusing to cooperate with an investigation is now the subject of a disciplinary action by regulators, Advisor Hub reports.
The Financial Industry Regulatory Authority initiated the proceeding against Portland, Oregon-based Ali F. Chehab. According to FINRA, Merrill Lynch fired Chehab in July 2024 for “failure to adhere to firm standards” regarding an impermissible recommendation to a self-directed client, prohibited use of personal email to conduct firm business, and “selling away,” or offering securities not approved by the firm. Merrill later said that it was conducting an internal review into Chehab’s “conduct involving unauthorized trading in Merrill Lynch client accounts.”
After Merrill filed its U5 termination notice about Chehab the following month, FINRA launched its own investigation of Chehab’s conduct in October. The authority states that Chehab refused to respond to requests for information in FINRA’s probe into whether he violated its rules and federal securities laws. “I’m not going to provide that information and I do not care if I get barred,” Chehab wrote to FINRA in an email, according to the complaint filed by FINRA’s enforcement department with the agency’s Office of Hearing Officers.
Chehab is thus accused of violating FINRA Rule 8210, allowing those who do not cooperate with the authority’s investigations to be banned, and Rule 2010, which requires member firms and associated persons to observe high standards of commercial honor and just and equitable principles of trade.
“Chehab’s failure to provide the requested information and documents impeded FINRA’s investigation into his potential misconduct because he deprived FINRA of documents and information that was material to its investigation,” the complaint alleges.
Chehab began his career with Equitable Advisors in 2022 and joined Merrill Lynch in 2023. His BrokerCheck record contains five disclosures, including two customer complaints from August 2024 settled for nearly $362,200 combined. Both accused Chehab of using their sign-in to trade in their self-directed account.
One disclosure from June 2024, which claimed that Chehab used personal text messages to engage in selling away, was closed with no action, according to BrokerCheck.
Chehab could not be reached for comment, and a Merrill spokesperson did not respond to a request for comment.
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