Former Merrill broker suspended for check-kiting, fined $5,000

Fuad Habba deposited checks drawn on closed accounts.

Former broker Fuad Habba has been suspended for three months and fined $5,000 for depositing into his Merrill Lynch checking account five checks drawn against defunct accounts at another bank.

Mr. Habba, who was employed by Merrill Lynch from 2013 to 2016, later went to work for Morgan Stanley, which terminated his employment in February.

Although he is no longer employed in the securities industry, Mr. Habba remains under the jurisdiction of the Financial Industry Regulatory Authority Inc., Finra said in a letter of acceptance, waiver and consent.

Finra said that from January to March 2016, Mr. Habba engaged in a check-kiting scheme in which he wrote and deposited $2,765 in checks into his personal checking account at Merrill Lynch. The five checks were drawn on other bank accounts that had been closed for years prior to the deposits, Finra said, noting that Merrill Lynch initially credited Mr. Habba’s account for each of the deposits and then subsequently rejected them.