EAST ST. LOUIS, Ill. (KCTV) – A former ALDI executive will spend time in prison for a $2.8 million scheme that helped a construction company owner manipulate the system and force the chain to overpay for new stores in both Illinois and Missouri.
The U.S. Attorney’s Office for the Southern District of Illinois announced that on Tuesday, October 22, Louis R. Ross Sr., 64, of St. Louis, and Donald E. Schniers, 73, were both convicted for their roles in a scheme to manipulate the construction bidding system for grocery stores in Illinois and Missouri.
Court officials indicated that Ross, a former real estate director for the ALDI division in O’Fallon, Missouri, pleaded guilty to multiple counts of mail and wire fraud and conspiracy. He was sentenced to two years in prison and ordered to pay more than $2.8 million in restitution.
Meanwhile, court documents noted that Schniers, owner of C. Junegel Co., a construction company based in Breese, Illinois, pleaded guilty to a single count of mail and wire fraud and conspiracy. He was sentenced to three years’ probation and ordered to pay more than $2.8 million in restitution.
Court records revealed that the pair conspired to fabricate and submit false bids to ensure C. Juengel won contracts for ALDI projects without real competition.
“As a trusted executive, Louis Ross exploited his position to personally profit by manipulating the procurement process, awarding projects to Donald Schniers’ construction company, and ultimately defrauding ALDI of millions of dollars,” said U.S. Attorney Rachelle Aud Crowe. “To protect the integrity of the construction procurement process and strengthen consumer protections, I appreciate our partnership with the FBI and the US Postal Inspection Service to ensure justice.”
From at least February 2014 through March 2018, law enforcement officials indicated that Ross and Schniers created a bogus competitive bidding environment. Schniers admitted that he completed false bidding forms under the guise of other companies, without their knowledge or consent.
“Ross and Schniers conspired to inflate prices and eliminate fair markets, the consequences of which trickled down to victims, consumers and the competition,” said FBI Springfield Special Agent in Charge Christopher Johnson. “The FBI is committed to working with our partners to investigate fraudulent schemes and bring to justice those who conspire to enrich themselves at the expense of the American public.”
Court documents noted that the bogus bids always included higher amounts than C. Juengel’s, resulting in the company awarding twelve general services contracts worth approximately $20 million.
Court officials also said Ross and Schniers manipulated the process by altering legitimate bids from other local construction companies. The suppressed competition caused ALDI to overpay for projects, incurring losses of more than $2.8 million.
“This conviction is a statement that mail fraud will not be tolerated and that perpetrators will be brought to justice,” said Acting Inspector-in-Charge John Jackman, who directs the US Postal Inspection Service’s St. Louis Field Office. “The Postal Inspection Service will continue to work with our law enforcement partners to jointly prosecute criminals who victimize postal customers, American consumers and businesses.”
Schniers allegedly paid Ross bribes for nearly a decade, according to law enforcement officials. These payments ultimately totaled more than $975,000. No further information has been released.
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