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Tuesday, December 22, 2009
Records: Woman Admitted Misspending
By Martin Salazar
Journal Staff Writer
The woman suspected of embezzling close to $3.4 million from a small northern New Mexico school district frequents casinos and offered to repay the school when initially confronted, according to court documents made public last week.
The search warrant affidavit contends that Kathy Borrego, the former business manager at the Jemez Mountain School District, admitted in a recorded conversation with the district superintendent in June that she had written "questionable" checks and apologized for her actions.
Borrego told the superintendent she was having a hard time and that she would get a loan from her father to pay the money back to the school, the court document states. The extent of the embezzlement was not known at the time.
The affidavit also states that Borrego is known "to frequent a number of gambling casinos in New Mexico."
The embezzlement investigation is ongoing, and charges have yet to be filed in the case, said Angela "Spence" Pacheco, the top prosecutor for Rio Arriba County.
Authorities previously seized computers, digital disks, bank statements, and other items from two Abiquiu homes owned by Borrego, 50, and her partner, Jerry P. Archuleta, 49. One of those properties is a home where Borrego's daughter, Rosana Lopez, 24, lives.
The latest search warrant provided authorization for a search and forensic analysis of the computers and other digital media devices seized. Authorities are looking for evidence of financial transactions involving Borrego, Archuleta or Lopez.
Computer experts with the FBI aided in the search and were able to conduct keyword searches on the items and recover deleted files.
The search warrant affidavit was filed by 1st Judicial District Attorney's investigator Frank Jacoby, who is working with a Rio Arriba County Sheriff's deputy on the investigation.
Borrego's bank records revealed a "suspicious" pattern of school district checks being deposited into her personal accounts, the affidavit states. It also states that one of the bank accounts was jointly owned by Borrego and Archuleta while the other was owned by Borrego and Lopez.
According to the affidavit, investigators have yet to completely review all the banking documents they've obtained, and they're waiting for other financial documents to be turned over.
A special audit conducted by the state Auditor's Office earlier this year pegged the embezzlement at close to $3.4 million. The district, in rural Gallina in Rio Arriba County, has about 375 students.
The state Public Education Department took over the district's finances in August after the audit was released.
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