Keeping an Eye on What’s Right … And Wrong

Patricia Struck is looking out for your retirement savings

Published in 2008 Wisconsin Super Lawyers magazine

By Christopher Hollenback on November 17, 2008


From 1989 to 2002, Kenneth Hackbarth—an usher at the Assembly of God church in Kenosha and an adviser with Homestead Investments—talked to fellow parishioners, often senior citizens, about investment opportunities. Give him $30,000 for three years, he said, and he would invest that money in real estate with the promise of a 15 percent return.

But Hackbarth wasn’t an investor. He was a retired schoolteacher taking the money and either donating it to the church, using it to pay off past investors or keeping it for himself. Eventually, the scheme collapsed when he couldn’t pay off investors fast enough.

That’s when Patricia Struck, well, struck. She issued a cease-and-desist order that led to a 10-year prison sentence for Hackbarth.

For the past 12 years, Struck has been the division of securities administrator with the Wisconsin Department of Financial Institutions. Her division regulates more than 1,800 broker-dealer firms, more than 113,000 securities agents and about 250 investment advisers. Each year, Struck and her staff get about 1,000 consumer inquiries and 200 complaints, either directly from consumers or via a third entity such as the police or FBI. Struck’s division refers about 12 cases per year for prosecution—like Hackbarth’s in 2003.

Investigators report to bureau chiefs who report to Struck. “I receive reports on ongoing investigations,” Struck says, “provide input on legal questions and policy issues and make decisions on the scope of the enforcement actions. Over and above enforcement, my responsibilities include policy development and implementation relating to regulation.” This includes outreach, licensing, exams and disciplinary actions for investment professionals such as stockbrokers, investment advisers and financial planners.

Struck knows how scams start. Seniors receive invitations in the mail for free lunches to learn about low-risk investments with promises of high returns. “The reason I know,” Struck says with a chuckle, “is I keep getting these in the mail all the time.”

She knows how they work because she occasionally meets the suspects. “You would swear, ‘Oh, he’s the nicest guy,'” she says. “They can be so persuasive. You can see why people are duped.”

She also knows that most of the money is lost forever. “If you invest with someone who’s lying and stealing and cheating, in most cases they spend money so rapidly that—even if [they] liquidate the exercise equipment, the boats and the house—there’s not going to be enough to pay back all the investors.”

And she knows that consequences go beyond lost money. Two of Hackbarth’s 117 victims committed suicide. “It’s shocking,” Struck says.

A fit, petite woman with a vibrant smile and red-brown hair cut above the shoulder, Struck sits with perfect posture in her neat, roomy office with government-minimalist décor. There are no framed newspaper clippings displaying her successful prosecutions, no plaques. She’s not one to grandstand. It’s one of the things peers respect about her.

“She has definite views on things [but] they’re always presented in a way that’s logical and nonconfrontational,” says Conrad Goodkind, a partner at Quarles & Brady and the former deputy commissioner of the state securities division. He also taught Struck at the University of Wisconsin-Madison in the 1970s. “She’s open-minded. Doesn’t always agree, and she’ll let you know. Being the securities administrator can be a technical job, and her common-sense approach is something you don’t always see. Some people who have held that position—I won’t name any names—that hasn’t been the case. She keeps an eye on what is right.”


Struck was born and raised in Milwaukee. Her father, George Struck, worked as an investment adviser and securities analyst. He was one of the first chartered financial analysts—in the inaugural class of 1963—and held Charter #175 until 1997, when he turned 79. “That’s one of my earliest memories of my father’s profession,” she says. “[My father] sitting down there studying for his charter.”

She adds: “I don’t see irony in the difference in our career paths, though I believe he did. He was so ethical that he probably wouldn’t have believed regulation was necessary. Until we all became aware of the massive frauds.” She mentions, as example, national cases like the Merrill Lynch case of 2003 that resulted in a so-called “global settlement” between Wall Street firms and regulators.

Struck studied art and literature at Mount Holyoke in Massachusetts. She spent her junior year abroad in Paris and still speaks French and Italian fluently. “My mother made it clear that there was nothing [her kids] couldn’t do,” Struck remembers.

Why law? “It’s a great discipline for the brain,” she says, adding, “People said I was good at it. When you do something and get a compliment, you tend to gravitate to that.”

In the late ’70s, Struck went straight from law school to Marine Bank—now known as Chase. “I got to do a little of everything. They were about to form a trust company. I got to review every trust indenture.” She pauses, aware that her enthusiasm may be outstripping the subject matter. “This may not sound fun to you.”

Foreshadowing her current job, she heard tales of woe from investors who were defaulting on legitimate opportunities. “As a corporate bond trustee, you stand in the shoes of the bond holders,” she says. “So if interest rates go too high and people owe money they can’t pay back, you have to declare default. That means the person will lose their business. It’s a horrible result for everybody. You never want to be the one to tell the investor the deal’s gone bad.”

While discussing the targeting of seniors, Struck turns visibly agitated. “They’re preying on the most vulnerable,” she says.

An increasingly popular scam involves seminars sponsored by “senior specialists” who promise to reduce investor’s taxes, minimize their risk, avoid state-probate laws—and even offer a free prime-rib dinner as bait. Typically, these scam artists recommend liquidating existing financial assets and dumping the money into annuities, which, of course, they sell.

Earlier this year, the North American Securities Administrators Association, or NASAA, adopted a rule that says, according to Struck, “It’s fraudulent to use these designations unless you really have the expertise that goes behind them.”

But punishment is tricky—actual criminal cases are rare. Instead, Struck says, “We can revoke their license, suspend their license or [censure] their license. Or if they don’t have a license, we can issue another kind of administrative order, which we call an order of prohibition. Basically it creates a record for anybody involved in the financial services industry. And while that might not sound like a real onerous sanction to the general public—‘Administrative order? What does that mean? It’s not going to throw them in jail’—it means that this person has a disciplinary record that will follow them in any state where they want to do business. And that information is all available to the public.”

Struck was president of NASAA a few years ago, and, in that capacity, testified before the U.S. Senate Committee on Aging, chaired by U.S. Sen. Herb Kohl, and warned members about the latest securities scams. “It was an amazing experience,” Struck says, if “a little intimidating.”

Her testimony resulted not only in the recent rule NASAA adopted but in Sen. Kohl’s “Senior Investor Protection Act of 2008,” which directs the U.S. Attorney General to “establish a program of grants to states to: (1) investigate and prosecute misleading and fraudulent marketing practices; or (2) develop educational materials and training aimed at reducing misleading and fraudulent marketing of financial products toward seniors.” The Act has not yet passed into law.

Cecil Swamidoss, counsel to the committee, says Struck has been invaluable because of her relationships with securities regulators across the continent. “She’s very knowledgeable and her attitude is ‘Let’s get things done,”’ Swamidoss says. “I’ve dealt with other state officials, and that’s not always the case.”

“You do your best to ensure investors are treated fairly,” Struck says, and that requires keeping up with new tactics. “Things are changing so quickly. Now investors get disclosure online—and it’s better, more meaningful and useful disclosure. You can research a financial adviser in the professional databases like the Central Registration Depository, but you can also get other good information on sites like Google or Facebook.”

An ounce of prevention is typically worth thousands, or tens of thousands, in cure. In cases where a convicted adviser worked at large financial institutions, the institution generally makes good; and Struck remembers one case where the father of a Milwaukee woman who defrauded investors and went to prison took it upon himself to pay back investors. But that’s the exception. Which is why she’s so involved in public outreach. “That’s what is often standing between you and the loss of your retirement funds,” she says.


Struck and her husband, Lawrence Bechler, a private-practice attorney, have three sons—Tom, 24; Stephen, 22; and Jonathan, 18—and, as with most parents, family time is important. Struck enjoys watching the Milwaukee Brewers and Stephen’s summer-recreation baseball team, Badger Sporting Goods.

But, as with most attorneys, she often works late. Sometimes the hallways are so deserted, and the place, without the hum of the air-conditioning, so quiet, that things can get a little spooky. But she keeps going. There’s so much work to be done. “Anytime you are just discovering a problem, measuring it,” she says, “you don’t exactly know the scope of the problem. You don’t know the parameters of the problem. You just know there’s a problem.”

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