Massachusetts Mayor Arrested on Federal Fraud Charges for Misusing $1.5M in COVID Relief Funds

Federal authorities arrested Lawrence Mayor Brian DePena on Friday morning, charging the 61-year-old with wire fraud and money laundering in connection with his alleged misappropriation of more than $1.5 million in pandemic-era small business loans. Investigators say DePena used Economic Injury Disaster Loans administered by the U.S. Small Business Administration to fund personal campaign accounts, settle tax obligations, and pay down high-interest real estate debts.

DePena, who took office in November 2021 and secured reelection in November 2025, previously served on the Lawrence City Council from 2016 to 2021. U.S. Attorney Leah B. Foley said the mayor violated the public trust through alleged corruption and deception. “Today’s arrest demonstrates our commitment to holding elected officials accountable,” Foley stated.

In May 2020, DePena applied for an EIDL on behalf of Tenares Tire Service Inc., his auto service and tire business in Lawrence. The SBA approved an initial $150,000 loan in June 2020 at 3.75% interest, designed solely to help businesses weather pandemic-related hardship. DePena later sought modifications, securing a $350,000 increase in April 2021 and another adjustment in October 2021 that brought the total to $1.1 million.

Once funds became available, prosecutors allege DePena systematically diverted the money between August and October 2021. He transferred nearly $90,000 from business accounts to personal accounts and wrote checks exceeding $42,000 directly to “The Committee to Elect Brian DePena,” court documents show.

Beyond campaign funding, DePena allegedly used federal relief money to resolve personal financial obligations. He paid $85,000 to the Internal Revenue Service for back taxes and another $883,293 to settle high-interest mortgages on residential properties he owned in Lawrence.

As of August 5, DePena had made only 16 payments on the Tenares Tire loan, totaling $130,160, which went entirely toward accrued interest. The outstanding balance remains approximately $1.65 million. Thomas Demeo, special agent in charge of the IRS Criminal Investigation Boston Field Office, emphasized that CARES Act funds were intended for business survival, not personal debts or political pursuits.

DePena made his initial federal court appearance Friday afternoon in Boston. If convicted, he faces up to 30 years in prison. The mayor’s office did not respond to requests for comment.