Steel Exec Admits Falsifying Lock & Dam Repairs

ST. LOUIS – A Missouri steel company owner is facing serious time after admitting he put profits over public safety. Theodore J. “Ted” Stegeman, 60, of Hazelwood, pleaded guilty Tuesday to one felony count of wire fraud in U.S. District Court. The charge stems from a scheme to defraud the contractor and the U.S. Army Corps of Engineers during a repair project on a vital Mississippi River lock and dam.

According to court documents, Stegeman, owner and CEO of Industrial Steel Fabrication LLC (ISF), knowingly supplied defective parts for Lock and Dam No. 25 near Winfield, Missouri. ISF was contracted to fabricate and weld cover plates – flanges – for all 17 bridge spans. These flanges were supposed to undergo rigorous ultrasonic testing to ensure weld integrity. Stegeman, however, chose to cut corners, risking catastrophic failure.

Federal investigators believe these flanges are critical, load-bearing components. A cracked weld could lead to complete structural failure of a bridge span, potentially causing fatalities and severe damage to a 220,000-pound crane operating on the dam. While Stegeman’s defense claims the flanges aren’t “fracture critical,” the potential consequences of his deception are undeniable. He knowingly put the entire structure – and those who rely on it – in jeopardy.

The fraud unfolded between October and December 2019. When a flange for bridge span #10 failed its ultrasonic test, Stegeman didn’t flag the issue. Instead, he reassigned employees who were aware of the failure and then altered the test report to falsely indicate a passing result. He repeated this pattern with a flange for span #12, instructing others to fabricate a passing test when no test had even been performed. Both defective flanges were installed.

The fallout? A total loss of $238,059 – the cost to remove, re-test, and re-install the compromised parts. Stegeman has agreed to full restitution. But money won’t undo the risk he created. He’s scheduled for sentencing on September 12, and faces up to 20 years in prison, a $250,000 fine, or both. This case underscores the dangers of unchecked greed and the importance of holding those who prioritize profit over safety accountable.

The investigation was a joint effort by the Defense Criminal Investigative Service and the Department of the Army Criminal Investigation Division. Assistant U.S. Attorney Kyle Bateman is prosecuting the case, and Grimy Times will continue to follow this story as it develops. This isn’t just about faulty steel; it’s about a blatant disregard for public safety and a betrayal of trust.