Lawrence Mayor Brian DePena has been arrested on federal charges, accused of misusing over $1.5 million in pandemic-era small business loans for personal and political expenses.
Brian DePena, the mayor of Lawrence, Massachusetts, was arrested on federal charges Friday following an extensive investigation into the alleged misappropriation of pandemic-era financial assistance. The 61-year-old official is accused of orchestrating a scheme to divert over $1.5 million in Economic Injury Disaster Loans (EIDL) intended to support struggling small businesses during the COVID-19 pandemic. The federal indictment includes charges of wire fraud and money laundering, highlighting an alleged breach of public trust.
The EIDL program was established icant economic distress during the public health crisis. Prosecutors allege that instead of utilizing these funds for their intended purpose—maintaining business operations and covering necessary expenses—DePena funneled the money into his personal finances and political campaign. The arrest marks a significant development in the ongoing effort uring a period of national instability.
According to the criminal complaint, the misuse of funds began shortly after DePena secured the loans through his auto service shop, Tenares Tire Service Inc. While the initial loan was approved for $150,000 in June 2020, the business owner sought multiple modifications to increase the total loan amount. tely $1.1 million, despite the business facing purported cash flow challenges that prompted the mayor to reach out to financial advisors with increasing urgency.
Internal communications cited the additional funds. In translated messages sent to an advisor, he expressed desperation, noting that he had no other options and was relying entirely on the advisor to secure the capital. Once the funds were transferred into business accounts, however, authorities claim that the money was quickly siphoned off to satisfy personal financial obligations rather than sustaining the tire shop.
The investigation indicates that the diverted funds were utilized for a variety of unauthorized personal expenses. Prosecutors allege that between August and October 2021, nearly $90,000 was moved from business accounts into the mayor's personal bank accounts. From there, thousands of dollars were allegedly funneled into his political campaign, "The Committee to Elect Brian DePena," effectively using taxpayer-backed relief funds to bolster his electoral ambitions.
Furthermore, the complaint details significant payments made toward personal debts. Approximately $85,000 was reportedly paid to the Internal Revenue Service to settle back taxes, while over $880,000 was used to clear high-interest mortgages on various properties owned lated the mandates of the CARES Act, which were designed specifically to prevent the collapse of small enterprises during an unprecedented economic downturn.
The financial fallout from these allegations remains significant. Records indicate that despite the substantial influx of loan money, only a small fraction of the total balance has been repaid. As of early August, the outstanding balance on the loans, including accrued interest, stood at roughly $1.65 million. This discrepancy between the received funds and the current debt highlights the scale of the alleged financial mismanagement that has now drawn the attention of the U.S. Attorney’s office.
DePena, who has served as the mayor of Lawrence since 2021 and was recently reelected in 2025, faces a potential prison sentence of up to 30 years if convicted on the current charges. As the legal proceedings move forward, the city faces a period of uncertainty regarding its leadership. Federal authorities have remained firm in their stance that such instances of corruption will be pursued aggressively to ensure the integrity of federal programs and the protection of taxpayer contributions.