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Justice News

Department of Justice
U.S. Attorney’s Office
Eastern District of Missouri

FOR IMMEDIATE RELEASE
Tuesday, July 16, 2019

Local Businessman Pleads Guilty to Bribery Scheme Involving Former St. Louis County Executive Steve Stenger

St. Louis, MO –John Rallo, 53, formerly of St. Louis County, pleaded guilty to three counts of Honest Services Mail Fraud/Bribery.  Rallo appeared in federal court this afternoon before U.S. District Judge E. Richard Webber who accepted his plea and set sentencing for October 15, 2019.

According to court documents, beginning in October 2014 and continuing through December 31, 2018, former St. Louis County Executive Steve Stenger schemed to defraud and deprive the citizens of St. Louis County of their right to his honest and faithful services, and the honest and faithful services of former CEO of the St. Louis Economic Development Partnership, Sheila Sweeney, through a pay to play bribery scheme.  The purpose of the scheme was for Stenger to secretly use his official position to enrich himself through soliciting and accepting campaign contributions from businessman John Rallo and other individuals in exchange for favorable official action in the awarding of contracts and grants through St. Louis County and the St. Louis Economic Development Partnership. 

Stenger, in exchange for campaign donations and several fundraising events hosted by John Rallo, took official action to insure that Rallo and his company, Cardinal Insurance, obtained insurance contracts through St. Louis County during 2015 and 2016.  Further, Stenger took official action to insure that John Rallo and his company, Cardinal Creative Consulting, obtained a sham 2016 consulting contract through the St. Louis County Port Authority.  Additionally, Stenger took official action to insure that John Rallo and his company, Wellston Holdings, LLC, obtained land contracts for two industrial properties in Wellston, Missouri which were held by the Land Clearance for Redevelopment Authority of St. Louis County during 2016 and 2017.  Rallo, Stenger, and Sweeney took steps to hide, conceal and cover up the illegal bribery scheme, including making false public statements.   

Rallo faces a maximum penalty of 20 years in prison and a $250,000 fine for each count.  Restitution is also mandatory. 

In determining the actual sentences, a judge is required to consider the U.S. Sentencing Guidelines, which provide recommended sentencing ranges.

The Federal Bureau of Investigation and the Postal Inspection Service are investigating this case with the assistance of the Internal Revenue Service Criminal Investigations.  Assistant U.S. Attorney Hal Goldsmith is handling the case for the U.S. Attorney’s Office.

Topic(s): 
Public Corruption
Updated July 16, 2019