FBI agents used a bullhorn and a battering ram to arrest Lawrence, Massachusetts Mayor Brian DePena at his home on federal wire fraud and money laundering charges, accusing him of diverting pandemic relief funds meant for struggling businesses into his own campaign coffers and personal debts.
DePena, 61, a dual citizen of the United States and the Dominican Republic, faces one count of wire fraud and one count of money laundering for allegedly obtaining more than $1.5 million through the Small Business Administration's Economic Injury Disaster Loan program, emergency money Congress authorized to keep small businesses alive during COVID-19, and spending the bulk of it on himself. Federal prosecutors say only about $150,000 of the loan ever went to the tire shop it was supposed to help.
The rest, AP News reported, allegedly went to pay off more than $880,000 in high-interest personal mortgages on various properties in Lawrence and to funnel $90,000 directly into his 2021 mayoral campaign fund. DePena had served on the Lawrence City Council from 2016 to 2021 before winning the mayor's office that November. He won reelection last November.
Neighbors told local outlet WCVB they watched FBI agents arrive at DePena's Lawrence home Friday morning, announce themselves over a bullhorn, and then force their way inside with a battering ram. DePena was taken into custody and transported to federal court in Boston, where he made an initial appearance Friday afternoon.
A federal judge released DePena under several conditions, including surrendering his passport and agreeing not to seek any loans without court approval. When reporters asked the mayor whether he planned to resign, he offered two words, "God bless", and nothing more. His defense attorney, Carlos Apostle, repeatedly told reporters "no comment" as the pair left the courthouse, with DePena reportedly beaming a large smile for the cameras outside.
The charges carry serious prison time. Wire fraud alone carries a maximum sentence of 20 years in federal prison, three years of supervised release, and a fine of up to $250,000. The money laundering count adds up to 10 more years, another three years of supervised release, and an additional $250,000 fine, a combined maximum of 30 years behind bars and $500,000 in fines.
The SBA's disaster loan program was designed for qualified small businesses suffering real financial losses during the pandemic. DePena applied on behalf of Tenares Tire Services Inc., a tire sales and automotive services shop in Lawrence. Prosecutors say he initially received the funds in 2020, then requested several loan increases in 2021 as his campaign ramped up and his personal finances deteriorated.
By 2021, prosecutors allege, DePena's mayoral campaign was running short of cash. He owed back taxes and was under pressure to pay off high-interest loans on multiple Lawrence properties. Rather than use the SBA money for the tire business, he allegedly redirected more than $1.3 million of the $1.5 million loan toward those personal obligations and his political ambitions.
Fox News reported additional details on how the money moved: DePena allegedly transferred nearly $90,000 to personal accounts, wrote more than $42,000 in checks to his own campaign committee, paid $85,000 in personal back taxes to the IRS, and used $883,293 to pay off personal mortgage debts. As of August 5, the loan still carried an outstanding balance of roughly $1.65 million, with DePena having made only $130,160 in payments.
DePena's case is far from the only instance of pandemic-era federal loan fraud. Federal agents have been tracking down alleged COVID fraud fugitives across the globe, pursuing cases that range from hundreds of thousands of dollars to tens of millions.
FBI Boston Division Special Agent in Charge Ted Docks accused DePena of exploiting a national emergency for personal enrichment. The Washington Examiner reported his full statement:
"This was emergency financial assistance meant to be a safety net for struggling businesses, not Mr. DePena's own personal ATM. When elected officials misuse federal funds for personal gain, they're breaking the trust of their constituents, and breaking the law."
Docks added that the FBI would "continue to doggedly pursue anyone who defrauds the federal government," warning that "that 'easy money' won't seem so easy after all."
U.S. Attorney Leah B. Foley struck a similar tone, pointing to the trust voters placed in DePena when they elected him:
"Mayor DePena was elected to be a leader for the City of Lawrence. He was looked up to and trusted by his constituents, but he betrayed that trust through his alleged corruption and lies."
Foley called the arrest "just another example of our determination to root out fraud by anyone, even public officials, and holding elected officials accountable."
IRS Criminal Investigation Boston Field Office Special Agent in Charge Thomas Demeo framed the alleged scheme against the backdrop of the crisis itself:
"CARES Act funds were created to help small businesses survive an unprecedented national crisis, not to bankroll personal debts, political ambitions, or real estate ventures."
The Department of Justice has made pandemic-era fraud a major enforcement priority, standing up new task forces and fugitive lists to recoup stolen taxpayer money.
The gap between what the loan was for and how the money was spent tells the story prosecutors want a jury to hear. Out of more than $1.5 million in SBA disaster funds, just $150,000, roughly ten cents on the dollar, went to Tenares Tire Services. The rest allegedly bankrolled a political career and dug DePena out of personal financial holes that had nothing to do with the pandemic.
Writing $90,000 in checks to his own campaign and characterizing them as "campaign loans" does not change what prosecutors say the money actually was: taxpayer-funded pandemic relief, obtained under false pretenses and spent on an election. If the allegations hold, Lawrence voters were effectively represented by a mayor whose campaign was partly financed by money stolen from a program meant to save small businesses from ruin.
Federal investigators have pursued similar fraud schemes across the country, including cases involving fugitives captured overseas after bilking federal programs out of staggering sums.
DePena has not publicly addressed the substance of the charges. His attorney has offered nothing beyond "no comment." No resignation has been announced, and no additional defendants or co-conspirators have been named. Several questions remain open: whether more charges are coming, what will happen to Tenares Tire Services, and whether Lawrence city government will take any formal action in response to the arrest.
Voters in Lawrence trusted DePena with their city. Prosecutors say he repaid that trust by treating a pandemic lifeline, money Congress authorized to keep small businesses from going under, as his personal campaign war chest. If the charges stick, the smile he flashed for the cameras on his way out of federal court may not last long.
When officials loot emergency programs designed for people in crisis, the damage goes beyond the dollar amount. It corrodes the public's faith that the government can be trusted to help when it matters most, and it makes the case, once again, that accountability for public corruption cannot be optional.
