Einhorn withdraws from WHEDA contract - WKOW 27: Madison, WI Breaking News, Weather and Sports

Einhorn withdraws from WHEDA contract

MADISON (WKOW) -- A Milwaukee financier pulls out of a state contract after questions about possible pay-to-play are raised.

But the businessman says he did nothing wrong.

In a letter to the state, Stephen Einhorn of Capital Midwest Fund II withdraws from managing $1 million in funds for small businesses.

Einhorn's firm was selected for the contract by officials with the Wisconsin Housing and Economic Development Authority.

Capital Midwest Fund II won the contract one month after Einhorn and his wife contributed $25,000 to Governor Walker's recall campaign.

Federal rules prohibit contract awards in public investment situations to individuals who contribute money to contract decision-makers within  two years of an award. Walker appoints WHEDA's board of directors.

But in a statement, Einhorn says this contract's structure triggered no violation of federal rules with the award. WHEDA officials suspended any award of money to Capital Midwest Fund II last year, but officials say the contract selection was proper, based on merit, and was free of political influence. 

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