After graduating from high school in 1917, Rugo went into business with his father. In 1929 he began the Rugo Construction Co. with his brothers. The Rugos were involved in many projects in the Boston area, including the construction of schools for the City of Boston and the Roman Catholic Archdiocese of Boston. In 1939, Rugo was elected president of the Associated General Contractors of Massachusetts. During World War II, the company built the Letterkenny Ordnance Depot in Chambersburg, Pennsylvania in a joint venture with the Perini Corporation. In 1945, Rugo's brother Joseph left the firm. Upon his departure he demanded an accounting of an investment fund he and his two brothers owned. Rugo refused and in 1948, Joseph sued him. In 1950, Massachusetts Supreme Judicial Court ordered Rugo to pay his brother $140,418 for his share in the fund. In 1952, Rugo's other brother, Leonard, sued him for an accounting of a $1 million slush fund used to make payoffs to public officials in Boston, Chicopee, Massachusetts, and other communities in connection with building contracts. Rugo testified to making payoffs between 1929 and 1943, but refused to name who received them. Boston City Auditor Charles J. Fox cleared Rugo of wrongdoing and ordered that the Boston School Committee pay Rugo the balance owed on the construction of a school.
