District Sues Embezzlement Suspect: Jemez Schools Lost $3.4 Million [Albuquerque Journal, N.M.]

Jan. 22--The Jemez Mountain School District and its insurer have filed suit against the district's former business manager, who is suspected of embezzling close to $3.4 million.

The lawsuit against Kathy Borrego and several others, including the district's auditing firm, comes on the heels of criminal charges filed against Borrego.

Among the charges she faces are six counts of embezzlement and four counts of tax evasion. The charges were filed in state district court in Tierra Amarilla earlier this month.

The civil suit was filed Tuesday in Albuquerque's state district court. Named as defendants are Borrego; her partner, Jerry Archuleta; Borrego's daughter, Rosana Lopez, all three of Abiquiu; and Andrew Duran of Espanola. Duran's relationship to the others isn't specified.

The Journal was unable to reach Borrego, Archuleta, Lopez or Duran late Thursday.

Also named is Accounting & Consulting Group, LLP, which gave the district clean audit opinions after reviewing its books. The firm referred requests for comment to its attorney, who didn't immediately respond.

The suit also names John Does 1-10 -- employees of the district and of financial institutions who may have participated or acquiesced in the alleged embezzlement -- and John Does A-Z -- relatives or acquaintances of Borrego who have gained from Borrego's alleged illegal acts.

The New Mexico Public School Insurance Authority and the Jemez district are seeking nearly $3.4 million in restitution from the defendants, along with treble damages from the auditing firm and the John Doe defendants for alleged violations of the New Mexico Unfair Trade Practices Act. They are also seeking attorney fees and costs.

"The plaintiffs were concerned that a great deal of time had passed since the disclosure of the embezzlement and were worried about the funds or assets disappearing," said Albuquerque attorney Stephen French, the plaintiffs' attorney in the case.

A temporary restraining order bars Borrego, Archuleta, Duran and Lopez from disposing of any of their assets.

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