A sitting Massachusetts state representative faces an 11-count federal indictment for allegedly looting more than $700,000 in pandemic relief money, the second Democratic official in the same region charged with COVID fraud this month.
Federal agents arrested State Rep. Francisco Paulino early Wednesday morning on charges of pandemic unemployment insurance fraud, pandemic loan fraud, and money laundering. Prosecutors say the second-term Democrat, who represents the 16th Essex District, ran the alleged scheme through a tax preparation firm he founded, funneling relief dollars into personal accounts, real estate expenses, loan payments, and even his own campaign war chest, Fox News Digital reported.
The indictment alleges Paulino's fraud began in April 2020, weeks after Congress opened the emergency relief spigot, when he filed for COVID benefits using the identity of an unwitting 77-year-old relative. That single fraudulent unemployment claim alone netted roughly $44,000 in benefits, the Washington Examiner reported. From there, prosecutors say, the operation grew. Between April 2020 and December 2021, Paulino allegedly obtained more than $700,000 in total pandemic relief funds through multiple fraudulent applications.
U.S. Attorney Leah Foley laid out the government's case in blunt terms.
"According to the Paulino indictment, Mr. Paulino devised a scheme to obtain more than $700,000 in federal pandemic relief funds. It is alleged that Paulino used some of the money for his own personal use, including real estate expenses, loan payments and transfers to his campaign account."
Foley added that Paulino did not simply pocket the money. He allegedly turned a profit on it a second time, lending stolen relief dollars to other individuals at interest rates higher than the pandemic loan rate he originally received, treating taxpayer-funded emergency aid like a personal lending operation.
Paulino's arrest did not land in isolation. Less than two weeks earlier, the FBI arrested Lawrence, Massachusetts, Mayor Brian DePeña on a separate 11-count federal indictment for pandemic loan fraud and money laundering. DePeña allegedly diverted more than $1.5 million in fraudulent COVID-19 loans, the New York Post reported. We covered DePeña's arrest when it broke.
Prosecutors say DePeña's alleged fraud also started in 2020, while he was still serving on the Lawrence city council. He applied for pandemic relief funds on behalf of Tenares Tire Services Inc., his tire shop in Lawrence. Instead of using the money for the business, he allegedly funneled relief dollars into his mayoral campaign and used them to pay off personal debts.
Two elected Democrats in the same corner of Massachusetts, both allegedly running the same basic play: grab emergency money meant for struggling workers and small businesses, then redirect it into personal accounts and political campaigns. The combined alleged fraud between the two cases exceeds $2.2 million.
FBI Special Agent in Charge Ted Docks did not hold back. He said both men "are accused of treating the COVID-19 pandemic as their own personal cash cows," Newsmax reported.
Foley framed the arrests as part of a broader federal effort to claw back pandemic relief dollars that went to fraudsters rather than to the workers and business owners Congress intended to help.
"Everyone listening today knows how difficult it was for Americans during the pandemic. The money these two individuals allegedly scammed was meant for hardworking Americans and struggling business owners, not for two greedy individuals who lied and stole for their own personal benefit."
She went further, making clear that holding public office provides no shield from prosecution.
"It is never a proud moment when we arrest a public official, but we will continue to do it until the message is received: No one is above the law, and no one gets a pass."
Foley also said her office remains "dialed in and laser-focused on rooting out every bit" of pandemic fraud and will "continue to hold fraudsters accountable until the stealing stops."
The charges against Paulino break down to eight counts of wire fraud and three counts of unlawful monetary transactions. Neither Paulino nor DePeña has entered a public plea, and no statements from either defendant appeared in the federal announcement.
Massachusetts House Speaker Ron Mariano called the charges against Paulino "extremely concerning" and said the chamber would monitor the case and act if needed. The statement stopped well short of calling for Paulino's resignation, leaving open the question of whether Democratic leadership in the state will take any concrete action against their colleague while the case moves through federal court.
The pattern is not limited to pandemic fraud. Massachusetts Democrats have faced a string of legal troubles in recent years. The state party's own chair was arrested on a drunk driving charge after a midnight traffic stop, adding to a growing list of incidents that raise questions about accountability within the state's dominant political organization.
Nor is the problem confined to the Bay State. Across the country, Democratic officials have faced criminal charges while seeking or holding office. In Michigan, a Democrat's prior arrest resurfaced during a competitive House race. In Florida, a fraud-charged candidate ran in a Democratic primary. The cases vary in severity, but the recurring theme is the same: elected officials and party figures who treat the public trust as optional.
What makes the Paulino case especially galling is the alleged starting point. Prosecutors say a sitting state lawmaker, someone elected to serve the public, launched his scheme by exploiting a 77-year-old family member who had no knowledge that pandemic benefits were being claimed in their name. That single act set the stage for a fraud operation that prosecutors say grew to more than $700,000 over roughly 20 months.
The money Paulino allegedly stole was not abstract federal spending. It came from emergency programs Congress created because millions of Americans lost their jobs and small businesses faced closure. Every dollar that went to a fraudster was a dollar that did not reach a laid-off worker or a shop owner trying to keep the lights on.
Paulino now faces the prospect of a federal trial. DePeña faces the same. Both men are presumed innocent until proven guilty. But the indictments paint a detailed picture: two Democratic officeholders in the same Massachusetts region, both allegedly running pandemic relief scams that began in 2020, both allegedly diverting taxpayer money into personal spending and political campaigns.
Billions in pandemic relief went out the door fast and with few guardrails. The American public was told speed mattered more than oversight. Cases like these show who paid the price for that choice, and it was not the people who wrote the checks.