Earlier this year, mayoral candidate Eileen Brady rejected a campaign contribution from former U.S. Sen. Bob Packwood (R-Ore.), who resigned office in 1995 over a sexual misconduct scandal. That was an awkward move, because Brady had personally solicited a contribution from Packwood's wife, the political consultant Elaine Franklin.
But while Packwood's money may not have been acceptable to Brady, her campaign disclosed on March 4 a $2,500 contribution from Lawrence Mendelsohn, a Southwest Portland investor who is a convicted felon.
If Mendelsohn's name is not immediately familiar to readers, it is more familiar federal law enforcement officials and labor union leaders. In the go-go 1990s and the early part of last decade, Mendelsohn was the business partner and top lieutenant to Andy Wiederhorn, who founded a Portland company called Wilshire Financial Services Group.
Wilshire got itself inextricably entangled with the now-defunct Portland pension fund manager Capital Consultants, LLC which carried out what has been termed the largest union pension-fund fraud in U.S. history.
Wiederhorn served time in federal prison after the Capital Consultants case unraveled, while Mendelsohn got a lighter punishment. Here's the federal Department of Labor's summary of his case:
"On May 24, 2004, in the United States District Court for the District of Oregon, Lawrence Mendelsohn, co-founder of Wilshire Financial Services, was sentenced to 18 months supervised probation with six months to be served as home detention under electronic monitoring. Mendelsohn was fined $10,000 and ordered to pay $105,454 in restitution. On November 21, 2003, Mendelsohn pled guilty to one count of filing a false income tax return. His conviction resulted from an investigation into the dissolution of Capital Consultants, LLC (CCL). CCL clients lost over $350 million, most of which came from union pension funds."
On Monday, Brady http://wweek.com/portland/wcp.v4/index2.phptold WW she was unaware of Mendelsohn's conviction.
"I didn't know that," she says. "Is it some kind of white-collar thing?"
She has asked her campaign staff to investigate.
Updated at 3:05 pm:
Brady says she will return Mendelsohn's check. "I'm sending his check back," she says. "It's the right thing to do."
Updated at 11:29 am on March 6:
Filings show Brady returned the check on March 5.
Learn more about the cash behind the campaigns at our PDX Votes Campaign Finance page.