Lawrence Mayor Brian DePeña Arrested on Pandemic Loan Fraud Charges

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Started 28D · Updated 27D

Lawrence, Massachusetts Mayor Brian DePeña was arrested on Friday and charged with wire fraud and money laundering for allegedly diverting over $1.5 million in COVID-19 small-business loans to personal and political uses. The Justice Department says DePeña obtained the loans for his tire business, Tenares Tire Services Inc., but instead used the funds to pay off high-interest mortgages, cover personal taxes, and inject $90,000 into his mayoral campaign.

The charges

DePeña faces one count of wire fraud and one count of money laundering. If convicted, he could face up to 20 years in prison on the wire fraud charge and up to 10 years on the money laundering charge. The FBI's Boston Division special agent in charge, Ted Docks, said DePeña was "cashing in on a public health crisis and blatantly defrauding a government program meant to keep businesses afloat during the pandemic."

The alleged scheme

Prosecutors allege DePeña initially took a $150,000 disaster loan for his business, then requested increases totaling $1.5 million as his campaign ran short of cash and he faced tax and mortgage pressures. The funds were allegedly used to pay off over $880,000 in high-interest mortgages and $90,000 went to his campaign fund ahead of the 2021 election. DePeña has been mayor since 2021 and previously served on the Lawrence City Council.

Reaction and next steps

DePeña was scheduled to be arraigned Friday afternoon. His spokesperson and chief of staff did not respond to requests for comment. The case highlights ongoing federal scrutiny of pandemic loan fraud, with officials vowing to prosecute those who misuse taxpayer funds.

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