NEW: Democrat Mayor Arrested In Connection With $1.5 Million Fraud Scheme– trendingpoliticsnews.com

Mayor Brian DePeña of Lawrence, Massachusetts was arrested and charged Friday with one count of wire fraud and one count of money laundering in connection with allegations that he fraudulently obtained more than $1.5 million in COVID-19-related small business loans and diverted the proceeds for personal and campaign purposes.

According to a press release from the U.S. Attorney’s Office for the District of Massachusetts, DePeña, 61, who was elected mayor of Lawrence in November 2021 and reelected in November 2025, previously served on the Lawrence City Council from 2016 to 2021. He owns Tenares Tire Services Inc., a tire sales and automotive services business in Lawrence.

Prosecutors allege that in 2020 and 2021 he applied for Economic Injury Disaster Loans (EIDLs) from the U.S. Small Business Administration on behalf of that business. These loans, offered during the pandemic to eligible small businesses experiencing substantial financial disruptions, carried an interest rate of 3.75 percent and were restricted to use as working capital to alleviate economic injury caused by COVID-19. Working capital, according to the charging documents, did not include funding a political campaign, paying personal taxes, or paying off mortgages.

The charging documents state that DePeña caused Tenares Tire to apply for and obtain an initial EIDL of $150,000 in June 2020 and used the majority of those funds as working capital for the business. By early 2021, however, prosecutors allege he needed additional cash because his mayoral campaign was struggling to pay bills, he owed the IRS for back taxes, and he owed nearly $900,000 to two private hard-money lenders charging 12 percent and 8 percent interest on loans secured by various properties he owned in Lawrence.