INDIANAPOLIS -- A Republican hopeful for Marion County sheriff is pulling out of the race amid an investigation into a prominent Indianapolis businessman.

Tim Durham, whose companies are at the center of a probe by the FBI, served as the campaign finance chairman for Tim Motsinger and was a large contributor, the Republican said on his Web site Wednesday night.

Images: Inside Durham's House
Analysis: Capitol WatchBlog: It's Not What It Is, It's What It Looks Like

"In light of the recent investigations concerning the non-campaign related business affairs of my campaign finance chairman, I have made the decision that it is appropriate to return any and all financial contributions and loans that my campaign has received from him or his affiliated businesses," read a statement on the site. "Unfortunately, this leaves my campaign in a non-competitive financial position. Therefore, it is with regret that I have decided to end my campaign for the office of Marion County sheriff."

FBI agents on Tuesday raided the offices of Durham's Obsidian Enterprises Inc., a leveraged-buyout firm, located on the top floor of the Chase Tower in downtown Indianapolis, and the Akron, Ohio-based Fair Finance Co.

A search of campaign finance records showed that the 47-year-old contributed at least $809,653 to candidates and political committees, virtually all of them Republicans, at the local, state and federal levels in the last few years, 6News' Norman Cox reported.

The politicians who received funds from Durham include Gov. Mitch Daniels, Marion County Prosecutor Carl Brizzi and Democratic Congressman Baron Hill.

An FBI spokesman said that the warrants to search Durham's offices are sealed, and that the agency would not release any details into the investigation.

An Indianapolis Business Journal article earlier this year questioned whether Fair Finance had the financial ability to repay Ohio investors who bought nearly $200 million in investment certificates.

Durham's attorney told 6News on Wednesday that his client is confident he's done nothing wrong.

Motsinger's exit leaves Bart McAtee unopposed for the Republican nomination, although it's still more than two months until the party's slating convention.

McAtee issued a statement Thursday saying that he had been looking forward to debating Motsinger.

"I do appreciate the way in which he has handled this difficult situation," McAtee said.

But it may not wrap up the nomination for McAtee because of lingering bad feelings among Republicans toward his father, former Sheriff Joe McAtee, who endorsed Democrat Frank Anderson eight years ago.

"I don't think it makes him the nominee," said 6News political contributor Abdul-Hakim Shabazz, "because there is a lot of distrust among Republicans for the whole McAtees because of their support for Frank Anderson. So somebody may pop out of the wings, but right now McAtee's the frontrunner."

Marion County Republican Chairman Tom John said he knows of nobody else who's interested.

In 2007, 6News toured Durham's 30,000-square-foot-home near Geist Reservoir. The seven-bedroom mansion includes a private apartment, where the late Anna Nicole Smith once stayed during the Indianapolis 500, and a two-story garage housing Durham's extensive classic car collection.