A Massachusetts-based bank is suing several former employees, claiming they took confidential client information after resigning to establish their own firm.
However, one of the advisors who left called the lawsuit “frivolous,” claiming MountainOne was using the courts and the media “in an attempt to sully (their) good and hard-earned reputation.”
In the suit, MountainOne Bank also argued that losing the advisors meant the bank also lost out on guaranteed payments from LPL Financial, which wanted to retain the Commonwealth-affiliated reps in the wake of the broker/dealer’s acquisition of that firm earlier this year.
The claims are part of a larger volley of accusations by MountainOne made in a lawsuit filed earlier this month in Berkshire Superior Court against the three former employees, who are now doing business as Green River Financial Services, a Kestra-affiliated firm (Green River, the individual advisors and Kestra are all named as defendants).
In the suit, MountainOne Bank argued that the three advisors conspired with Kestra to “willfully breach their fiduciary duties, steal confidential information, and engage in other serious bad faith conduct.”
According to MountainOne, starting in the summer of 2025, Robert Abel, Jason Dohaney and James Durand began secretly setting up Green River as a competing advisory firm, opting to affiliate with Kestra. According to FINRA records, the three advisors first affiliated with Commonwealth in 2010.
MountainOne alleged that the advisors made employment offers to three other bank employees to move with them to Green River before the advisors resigned, and asked the employees to perform tasks related to Green River during MountainOne’s business hours.
Additionally, MountainOne claimed that the advisors instructed one of the employees to print customer account reports for their use at Green River and to remove the reports from MountainOne’s office (the lawsuit was first reported last week by Rural Intelligence).
According to the suit, the advisors also uploaded confidential client information onto cloud storage in preparation for their departure, and the advisors’ accessing and downloading of confidential information increased before their resignations on Oct. 3. According to MountainOne’s website, the bank now has one advisor.
Before the advisors resigned, they agreed to remain at MountainOne if the firm stayed affiliated with Commonwealth after it was acquired by LPL, according to the lawsuit. Earlier this year, LPL purchased Commonwealth in a $2.7 billion deal, and LPL aims to retain approximately 90% of Commonwealth’s advisors following the integration.
According to MountainOne, the bank relied on the advisors’ assurances when dealing with LPL; however, the firm now stands to lose most of the payments LPL had agreed to based on their assumption the advisors would stay with Commonwealth.
According to MountainOne, the advisors argued that they didn’t break any confidentiality agreements, claiming they had a “‘separate’ affiliate relationship” with Commonwealth independent of MountainOne, and that MountainOne had “no proprietary interest” in the client information.
In a statement to WealthManagement.com, Abel stated that MountainOne was spreading lies about the newly established firm in an attempt to unfairly compete, and argued that the “confidential information” indeed belongs to Commonwealth.
Additionally, Abel said if a Commonwealth-affiliated advisor moves to another b/d, those advisors can retain copies of client’s information so they could continue to serve the client. Abel claimed the firm had permission from Commonwealth and the clients to keep the information, and said that clients were free to remain with MountainOne if they chose (for those that did, Abel said Green River did not retain their information).
“MountainOne’s claims to the contrary are patently wrong, and we intend to pursue our own claims arising both from these false allegations and MountainOne’s other unlawful misconduct,” Abel wrote in his statement.
Kestra did not respond to requests for comment prior to publication.
According to the suit, MountainOne seeks an injunction to compel the advisors to return the client information they allegedly took, as well as to require them to pay damages.
The Berkshire Eagle reported on Monday that MountainOne Bank is merging with Mechanics Cooperative Bank, another Massachusetts-based institution, under a single holding company. After the merger next year, the consolidated holding company would have 15 locations and about $1.8 billion in assets (with MountainOne making up about $1 billion).
According to the Eagle, MountainOne has six branches, including three in the Berkshires.
