Lawrence Mayor Brian DePena was arrested Friday on federal wire fraud and money laundering charges tied to the alleged misuse of more than $1.5 million in COVID-era business loans. Prosecutors say he used funds intended for his Lawrence tire business to pay personal taxes, settle real estate debts and support his mayoral campaign. He faces up to 30 years in prison if convicted and was scheduled to make his initial appearance in federal court in Boston.
The case involves Economic Injury Disaster Loans administered under the CARES Act. The allegations concern transactions made after DePena received loan increases for Tenares Tire Service Inc., which he operated in Lawrence.
Federal officials said the investigation reflects efforts to hold public officials accountable for alleged misuse of taxpayer-funded relief programs. DePena’s office had not immediately responded to a request for comment.
| 1) | The federal charges and arrest |
| 2) | How the EIDL funding was obtained |
| 3) | The alleged diversion of loan proceeds |
| 4) | Officials’ response and the outstanding balance |
| 5) | The mayor’s legal and political position |
The federal charges and arrest
DePena, 61, was arrested Friday morning after a federal investigation into the alleged misuse of Economic Injury Disaster Loans. Prosecutors charged him with wire fraud and money laundering, alleging that he obtained and moved federal relief money for purposes unrelated to his business’s financial needs.
DePena became mayor of Lawrence, a Boston suburb, in November 2021 and won reelection in November 2025. Before becoming mayor, he served on the Lawrence City Council from 2016 through 2021. The charges remain allegations, and a conviction would require proof in court.
How the EIDL funding was obtained
In May 2020, DePena applied for an EIDL on behalf of Tenares Tire Service Inc., an auto service and tire shop in Lawrence. The program was created during the COVID-19 pandemic to help businesses manage economic injuries and related financial pressure. The loans carried a 3.75% interest rate and were restricted to eligible business purposes.
The Small Business Administration initially approved a $150,000 loan in June 2020. After DePena reported continuing cash-flow problems, he applied for an increase in April 2021 and received a modification that raised the loan to $350,000. A second modification in October 2021 brought the total loan amount to $1.1 million.
Officials said DePena became concerned when he could not access the funds for about a month. In a translated Spanish message to a financial adviser helping with the application, he allegedly wrote that he was in trouble and had no time to wait for the loan.
The alleged diversion of loan proceeds
Prosecutors allege that DePena began transferring money away from business use after receiving the loan proceeds. Between August and October 2021, he allegedly moved nearly $90,000 from business accounts to personal accounts.
The complaint says he then wrote checks totaling more than $42,000 directly to “The Committee to Elect Brian DePena.” Officials also allege that he used the relief funds to pay $85,000 to the Internal Revenue Service to settle personal back taxes.
Prosecutors say $883,293 was used to pay high-interest mortgages on properties DePena owned in Lawrence. The allegations form the basis of the government’s claim that funds intended to support a struggling business were redirected to personal and political purposes.
Officials’ response and the outstanding balance
Federal officials characterized the alleged conduct as a misuse of taxpayer resources during a national emergency. They said relief funds were not intended to finance personal debts, political activity or real estate investments.
The complaint states that, as of August 5, DePena had made 16 payments toward the Tenares Tire EIDL totaling $130,160. Because those payments went toward accrued interest, the outstanding balance was approximately $1.65 million, according to the filing.
The mayor’s legal and political position
DePena’s initial federal court appearance was scheduled for Friday afternoon in Boston. The wire fraud and money laundering charges could expose him to a maximum sentence of 30 years in prison if he is convicted, although the outcome will depend on court proceedings.
The allegations have implications for DePena’s legal status and public confidence in Lawrence’s government. He remains an elected mayor after securing a second term in November 2025, while the criminal case proceeds. His office had not immediately issued a response to the allegations or arrest.
| No. | Key Point |
|---|---|
| 1 | Brian DePena was arrested and charged with wire fraud and money laundering. |
| 2 | Prosecutors allege that more than $1.5 million in pandemic-era loans was misused. |
| 3 | Alleged personal uses included taxes, mortgages and campaign contributions. |
| 4 | The remaining EIDL balance was approximately $1.65 million as of August 5. |
Summary
The case centers on allegations that DePena diverted COVID relief financing obtained for his tire business toward personal debts, real estate obligations and campaign activity. His arrest underscores federal scrutiny of pandemic-relief fraud, but the allegations must still be tested through the judicial process.
Frequently Asked Questions
What charges does Brian DePena face?
He faces federal charges of wire fraud and money laundering related to the alleged misuse of Economic Injury Disaster Loans.
How were the loan funds allegedly used?
Prosecutors allege that funds were used for personal back taxes, high-interest mortgages on personal properties and checks to DePena’s mayoral campaign committee.
What happens next?
DePena was scheduled to make his initial appearance in federal court in Boston. The case will proceed through the federal court system, where the allegations must be proven.