In a high-profile takedown, a Massachusetts mayor has been arrested over federal accusations that he misappropriated Covid relief funds meant for his tire business to bankroll his political campaign.
Brian Depena, who serves as the Mayor of Lawrence, faced arrest on Friday following revelations of alleged fraud that prosecutors claim tops $1.5 million.
Authorities have charged the 61-year-old with one count of wire fraud and another of money laundering, marking a significant development in the case.
Depena, elected as mayor in November 2021 and securing reelection the following year, previously contributed to local governance as a member of the Lawrence City Council from 2016 through 2021.
The allegations suggest he secured a $1.5 million COVID-19 small-business loan claims for his tire sales venture, which prosecutors allege was then funneled into his campaign coffers.
Rather than using the money for the business, Depena allegedly spent more than $880,000 to pay off high-interest mortgages on various businesses and put $90,000 into his mayoral campaign fund ahead of the 2021 election.
Neighbors told WCVB that they woke up to FBI agents shouting through a bullhorn outside his home on Friday morning. They then used a battering ram to force entry into the property, the outlet reported.
He made an initial appearance in federal court in Boston on Friday afternoon and was released after agreeing to several conditions, including turning over his passport and not seeking any loans without court approval.
After leaving court, Depena’s lawyer Carlos Apostle repeatedly responded with ‘no comment’ to questions while his client beamed a large smile for the awaiting news teams.
Depena, the Mayor of Lawrence, was arrested and charged on Friday in connection with the alleged fraud, that authorities said amounted to over $1.5 million
He is accused of obtaining a COVID-19 small-business loan worth $1.5 million for his tire sales business, seen here
Depena, who is a citizen of the United States and Dominican Republic, responded with ‘God bless’ when asked if he would resign. He made no other comments.
In 2020 and 2021, Depena obtained a government disaster loan for Tenares Tire Services Inc., a tire sales and automotive services business in Lawrence.
During the pandemic, the Small Business Administration offered loans to qualified businesses that were suffering financial losses.
He used a loan of $150,000 for the business. A year later, prosecutors say, Depena’s mayoral campaign was running short of cash, he owed back taxes and was under pressure to pay back high-interest loans on several of his properties in Lawrence.
He then requested several increases to the government loan and allegedly used $1.5 million to cover those expenses unrelated to his tire business.
If convicted on the wire fraud charge, Depena faces up to 20 years in prison, three years of supervised release and a fine of up to $250,000.
He faces a sentence of up to 10 years in prison, three years of supervised release and a fine of $250,000 if convicted on the money laundering charge.
Depena was elected mayor in November in 2021 and reelected last November, having previously served on the Lawrence City Council from 2016 until 2021
Depena is accused of obtaining a COVID-19 small-business loan worth $1.5 million for his tire sales business
Ted Docks, the special agent in charge of the FBI’s Boston Division, accused Depena of ‘cashing in on a public health crisis and blatantly defrauding a government program meant to keep businesses afloat during the pandemic.’
A statement said: ‘When elected officials misuse federal funds for personal gain, they’re breaking the trust of their constituents – and breaking the law.
‘Together, with our partners, the FBI will continue to doggedly pursue anyone who defrauds the federal government.
‘You’ll be prosecuted to the fullest extent of the law, and that `easy money´ won´t seem so easy after all.’
United States Attorney Leah B Foley added: ‘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.
‘Today’s arrest is just another example of our determination to root out fraud by anyone, even public officials and holding elected officials accountable.’