Brian DePeña was arrested Friday on federal charges of wire fraud and money laundering after authorities said he diverted about $1.5 million in pandemic relief funds. He is due in US District Court in Boston later Friday.
Prosecutors said the money came from Economic Injury Disaster Loans for Tenares Tire Services Inc., a Lawrence business owned by DePeña. They alleged the funds were supposed to serve as working capital for pandemic hardship, but instead were used for campaign spending, personal debts, taxes and mortgages.
US Attorney Leah B. Foley’s office
Leah B. Foley said, “Mayor DePena was elected to be a leader for the City of Lawrence.” She added, “He was looked up to and trusted by his constituents, but he betrayed that trust through his alleged corruption and lies. Today’s arrest is just another example of our determination to root out fraud by anyone, even public officials and holding elected officials accountable.”
Ted E. Docks said, “Today, the FBI arrested Mayor Brian DePena for allegedly cashing in on a public health crisis and blatantly defrauding a government program meant to keep businesses afloat during the pandemic,” and called the loans “emergency financial assistance meant to be a safety net for struggling businesses, not Mr. DePena’s own personal ATM.”
Tenares Tire Services Inc
DePeña applied for the loans in 2020 and 2021. On Aug. 16, 2021, $350,000 was electronically deposited into the Tenares Tire bank account, which prosecutors said had been depleted to $20.23 before the deposit.
Soon after, prosecutors alleged, he paid $85,000 to the IRS for personal tax debts, transferred $120,000 to a personal account and used that money to write $90,000 in checks to The Committee to Elect Brian DePena. In late 2021, the federal government approved a modification that increased the loan by more than $1.5 million, bringing the total to $1.65 million.
Brian DePeña texts July 22, 2021
Federal filings also say DePeña texted his accountant on July 22, 2021: “Brother, call me, I’m in trouble,” and, “I don’t want to pressure you, but I don’t have time to wait for this loan. I’m in your hands.” Three days later, he texted, “Brother, I need your help with this loan. I’ve been trying to reach you all week and haven’t been able to get it resolved. I know I’m bothering you a lot, but I have no other option. Only you can give me what I need.”
Prosecutors said DePeña was first elected mayor in November 2021 and reelected last November, while the alleged spending continued. They said he used more than $42,000 for his mayoral campaign and $883,293 for mortgages on properties he owned in Lawrence. His initial court appearance later Friday will be the first step in determining how the case proceeds after the arrest.
