NASD arbitrators found that Merrill Lynch improperly fired an Iranian Muslim broker and lied about him on an official termination form. The bank was ordered to pay $1.6 million in damages.
The July 19 ruling comes less than a month after a federal government agency sued Merrill for allegedly discriminating against another Iranian Muslim ex-employee in a different division and location.
According to the NASD panel's decision, Fariborz Todd Zojaji had worked as a financial advisor at Merrill for nine years with a clean record, before being "abruptly terminated" in November, 2004. The arbitration panel found that Zojaji was fired without cause at the instigation of Brian Sepe, regional complex director for Merrill's suburban Miami branch network where the broker had worked. It awarded $400,000 compensatory damages and $1.2 million punitive damages, plus attorney's and other fees.
The decision states that Sepe, "upon learning over lunch that Claimant was a representative of an ethnic minority," demoted Zojaji from a management track and "basically sent (him) to a corner to be eventually terminated." Evidence showed that Sepe's conduct toward Zojaji "was not merely grossly negligent, it was intentional," the arbitrators wrote.
Zojaji's lawyer told The Wall Street Journal that his client is an Iranian-born Muslim who emigrated to the U.S. with his parents while a student. The Journal quoted a Merrill spokesman saying, "We approached this matter in good faith. We regret the panel didn't view the evidence in the same light we did."
In June, the U.S. Equal Employment Opportunity Commission sued Merrill Lynch under the Civil Rights Act, based on Majid Borumand's complaint that he was verbally harassed and eventually fired for being an Iranian and a Muslim while working as a quant analyst in a Merrill investment banking division in New York.