High-Producing Boston Broker Joins Kestra After Morgan Stanley Departure
Jonathan Lonske, a former high-producing Morgan Stanley Wealth Management broker in Boston who sources said was dismissed last month for using unapproved client-prospecting software service, has set up an independent practice on Wednesday through Kestra Investment Services, according to his BrokerCheck record.
At least two advisors on his Morgan Stanley team—Tara Schutz and Mary Flanigan— also registered with Kestra on Wednesday, according to their BrokerCheck records.
Lonske and Schutz did not return requests for comment, and a Kestra spokeswoman said she could not immediately comment.
The Austin, Texas-based broker-dealer works with around 1,700 independent brokers, according to its website, and last month underscored its push to attract advisors from employee-model firms.
Kestra added 15 teams managing $2.2 billion in this year’s third quarter, including a $1 billion-asset Merrill Lynch practice in Maryland.
“We’ve observed an acceleration of more wealth managers leaving employee models to launch their own businesses as a result of the pandemic,” Daniel Schwamb, Kestra’s head of recruiting said in a prepared statement. “Moving forward, we expect to see a continuation of this trend.”
Lonske, following his rookie months with now-defunct Gruntal & Co., has worked since 1996 at a succession of wirehouses, according to BrokerCheck. They included, chronologically, Merrill, UBS/PaineWebber, Morgan Stanley Dean Witter and Smith Barney, which he joined in late 2008 shortly before it was merged into Morgan Stanley.
He appears to have run afoul of the wirehouse’s data protection policy by maintaining prospecting lists outside of Morgan Stanley’s customer relationship management system, according to two sources. The firm had earlier approved his use of the software, but recanted as it became more sensitive in recent months to customer privacy issues, one source said.
Morgan Stanley in October reached a $60 million settlement with its national bank regulator for failing to scrub client data from decommissioned hardware. It also is battling several class-action lawsuits over the issues.
Lonske’s BrokerCheck history as of Thursday morning did not include a termination filing. He has accumulated four customer complaints of unsuitability or misrepresentation, all of which were settled. The largest settlement, $125,000 in 2017, alleged unsuitable investment recommendations over ten years.
Neither Schutz, who merged her solo practice with Lonske’s in 2016, according to the team’s former website, nor Flanigan have disclosures on their records. Both are certified financial planners, according to their biographies.
Schutz first registered as a broker in 2010 at Morgan Stanley. Flanigan has been registered for all but one year of her 16-year career at the wirehouse and predecessor firms.