A now-former employee of a tiny West Texas school district pleaded guilty to embezzling more than a quarter-million dollars meant for educating students and using the money for personal expenses.
Ernesto Villarreal Jr., 43, stole the taxpayer funds while employed as the business manager and tax assessor-collector for Valentine Independent School District.
Lack of oversight allowed Villarreal to carry out his embezzlement schemes undetected for six years—from around 2016 to 2022.
Valentine ISD has one school and fewer than 50 students.
According to budget data for the past four school years, the district enrolled 24 to 44 students per year and collected and spent $41,000 to $75,000 per student.
Villarreal stole taxpayer money from Valentine ISD using a variety of schemes.
Investigators found that Villarreal used two Valentine ISD credit cards to make hundreds of personal purchases totaling thousands of dollars.
Villarreal also wrote tens of thousands of dollars’ worth of unauthorized checks from Valentine ISD accounts to himself and to a credit card company for his personal expenses. In addition, he generated more than $100,000 in fraudulent payments to current and former district employees, then routed the money to his personal bank accounts.
According to a statement from the U.S. Department of Justice, Villarreal used the ill-gotten funds for hundreds of unauthorized personal purchases, including travel expenses, home improvements, and personal cell phone bills.
Prosecutors believe Villarreal caused more than $300,000 in losses to Valentine ISD.
Villarreal was placed on administrative leave in October of 2022 after a routine audit revealed his unauthorized financial transactions, prompting state and federal criminal investigations. He resigned from Valentine ISD in November 2022.
He also served on the Marfa ISD board of trustees from September 2021 until he resigned in February 2024.
Authorities arrested Villarreal in June 2024 and charged him with nine federal felonies.
Villarreal pleaded guilty to one count of theft from programs receiving federal funds and eight counts of wire fraud.
He faces up to 10 years in prison for the theft charge and up to 20 years in prison for each wire fraud count.
Sentencing is scheduled for February 21, 2025.
