Former leader of Cedar Rapids tourism agency admits fraud
CEDAR RAPIDS, Iowa (AP) — Two leaders of a Cedar Rapids tourism agency have admitted they defrauded a bank to acquire money to finance a three-day music and cultural event in 2018.
Aaron M. McCreight, 47, of Dothan, Alabama, was president and CEO of GO Cedar Rapids, which promoted the “Newbo Evolve” event in 2018. He pleaded guilty Thursday to bank fraud.
Douglas S. Hargrave, 55, from Puyallup, Washington, pleaded guilty Wednesday to the same charge, federal prosecutors said in a news release.
The men admitted defrauding Bankers Trust in Cedar Rapids by misrepresenting ticket sales, projected revenues and expenses and the total loss they were projecting for the event, which was to feature concerts by Kelly Clarkson and Maroon 5.
As the event dates approached, the tourism agency did not have the money to, among other things, pay Clarkson or buy alcohol for the concert venue, prosecutors said. The event lost $2.3 million.
GO Cedar Rapids couldn’t repay a $1.5 million loan from Bankers Trust or $800,000 promised to vendors and eventually went out of business.