A businessman pleaded guilty to federal charges Tuesday, admitting that he provided bribes as part of a pay-to-play scheme led by the former St. Louis County executive.
John Rallo’s plea to three bribery counts makes him the fourth person to plead guilty in connection with the case. He will be sentenced on Oct. 15.
Rallo, 54, was indicted days after ex-County Executive Steve Stenger pleaded guilty in May to federal charges for directing county contracts to campaign donors. Stenger, a Democrat, resigned hours after he was indicted and faces sentencing Aug. 9. Sentencing guidelines suggest he could get up to four years in prison.
The bribery indictment against Rallo claimed he gave Stenger tens of thousands of dollars in donations with the understanding that his companies would get contracts.
Former Stenger chief of staff Bill Miller and Sheila Sweeney, who was appointed by Stenger to head the county’s economic development partnership, also have pleaded guilty in the case. Sweeney is to be sentenced on Aug. 16 and Miller on Sept. 6.
Stenger’s activities had been under investigation for well over a year by the FBI, IRS and U.S. Postal Service. The county council was conducting its own ethics investigation, and reports by the St. Louis Post-Dispatch also focused on Stenger’s activities.
The county executive is the top elected official in St. Louis County, Missouri’s largest county with about 1 million residents.
In his plea, Stenger admitting taking actions to ensure that county contracts went to two Rallo-owned companies — Cardinal Insurance and Cardinal Creative Consulting — and ensuring that Rallo’s Wellston Holdings LLC obtained options to buy two properties held by the county’s Land Clearance for Redevelopment Authority.
Stenger also was accused of ensuring that an unnamed company obtained a state lobbying contract from the St. Louis Economic Development Partnership, and taking actions to conceal the illegal conduct.
In addition to the federal case, Rallo last month was ordered by Missouri’s securities commissioner to repay $1.2 million to six investors and pay a $30,000 civil penalty. The state said Rallo sought investors in a company that he said would sell coconut powder to Costco and Sam’s Club as a food product sweetener. The state claimed that Rallo largely used the investments for his other businesses.
Sweeney was forced out by the St. Louis Economic Development Partnership’s board of directors in January. Her removal followed Post-Dispatch investigations that, among other things, raised questions about procurement practices and the awarding of contracts to Stenger’s campaign donors.
In her guilty plea in May, she admitted to helping cover up Stenger’s crimes.
Miller admitted to pressuring Sweeney to renew a state lobbying contract with a company whose owner donated $59,000 to Stenger. The company and owner weren’t identified in court documents.
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