Pittsburgh plans to launch a criminal investigation into a promotion company that left a trail of unpaid bills and unfulfilled obligations leading to Tuesday’s cancellation of the annual Pittsburgh Three Rivers Regatta, a top city official said Wednesday.

Pittsburgh Public Safety Director Wendell Hissrich said he consulted with police Chief Scott Schubert, Mayor Bill Peduto and regatta officials before deciding an investigation was warranted. He said detectives would be assigned to the case.

“We believe there is enough to initiate a criminal investigation and to determine potential victims,” Hissrich said.

Pittsburgh itself is one of the victims, according to Peduto.

Officials said LionHeart Event Group, a private Pittsburgh-based company paid to operate and manage the regatta, owes the city $28,000 for police security services during the past two regattas, but they believe it’s only a small part of what’s owed to various vendors and agencies.

Repeated attempts to reach Derek Weber, LionHeart’s president and founder, have been unsuccessful. No one answered the front door at his Ross home on Wednesday and more than 20 unopened packages were piled up in front of his garage.

The Pennsylvania Department of Conservation and Natural Resources, which oversees Point State Park, said LionHeart owes nearly $7,000 for park space rental during this year’s Fourth of July fireworks celebration and the regatta.

It includes $2,550 for space to erect a sand sculpture for the regatta and $3,949 for the fireworks display that LionHeart promoted, according to park Manager Jake Weiland. The artist plans to complete the sculpture despite the regatta’s cancellation.

Thomas Koet and Jill Harris, a husband and wife who co-own Florida-based Sandsational Sand Sculpting, continued working under a tent Wednesday to complete the sand sculpture at Point State Park. They were paid for their work ahead of time because the materials, including 100 tons of sand, had to be purchased, Koet said.

They thought the tent would be taken down when the event was canceled, but Pittsburgh-based J.V. Chujko told them he would let the tent stay up through Tuesday morning and won’t charge them for it, according to the company’s Ed Wildauer.

The sand sculptors have been in town two weeks and expect to finish the sculpture by Friday.

“This is sad for the event because we didn’t expect this,” Koet said. “The city didn’t have to let us stay here, but they did and we are glad to build this happy sculpture. Pittsburgh has had a rough time (with the Tree of Life tragedy) so we wanted to create something happy.”

The sculpture’s theme is the four seasons and shows a pumpkin patch, spring flowers, a snowman and a summer scene. There are bridges and skyscrapers representing the city.

Weiland said LionHeart also failed to deliver a required $25,000 security deposit before the fireworks display, but he permitted the event to go on because of its significance. The money is security for damages and required for every park event. Weiland said the park was not damaged during the fireworks.

“We don’t technically allow it, but again it’s the Fourth of July,” he said. “I didn’t want to pull the rug out for the city, for the vendors and everybody coming down to see the fireworks.”

The regatta is financed almost exclusively through corporate sponsorships. Peduto said regatta officials are conducting an audit to find out exactly how much has been spent. Peduto said it typically costs around $800,000 to stage the three-day event, which was scheduled to begin Friday.

“I think you’re going to see a long line of vendors that weren’t paid, and well into the six figures,” Peduto said.

He reiterated that the regatta is not a city event. It operates through a nonprofit company overseen by a board of directors, which hired LionHeart.

LionHeart has promoted the regatta for the past three years, but Weber has been involved through various companies since at least 2010. Peduto said the board trusted him and monthly written financial reports he provided that indicated all was well.

“It appears that the reports were falsified, that they were being given on a monthly basis false financial records,” the mayor said. “This was not something that anyone picked up on, nor would they because they trusted the company that was hired to operate and manage the event. According to their board, on a monthly basis they thought they were in a good financial standing.”

Hissrich became increasingly concerned about the amount owed to the city and repeatedly requested payment, according to city officials. He consulted Peduto after talking with a Point State Park official following the fireworks display.

“(Hissrich) found out that what the private company had been telling him was completely different from what the state official was telling the director,” Peduto said.

The city and park officials pushed back deadlines for event permitting, but LionHeart never responded to a proof of liability insurance requirement, officials said. Peduto said city officials and the regatta board attempted to move the event to the North Shore.

Peduto said the board canceled the regatta after LionHeart failed to provide proof of insurance.

“They found out that not only hadn’t there been any purchase of the insurance, but when they asked for the receipt on Monday there was silence,” he said.

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