TRI-COUNTY — Ernie Villarreal was sentenced to 27 months in federal prison and ordered to pay restitution to Valentine ISD in the amount of $314,497 in a federal court proceeding in Pecos on Wednesday.
Villarreal, 43, of Marfa, pled guilty to eight counts of wire fraud and one count of theft concerning programs receiving federal funds in November for defrauding Valentine ISD, where he previously worked as the business manager and tax assessor collector. The Wednesday sentence was handed down by U.S. District Court Judge David Counts.
Valentine ISD Superintendent Debbie Engle urged the court to hold Villarreal accountable in a manner reflective of the “severity of his wrongdoing” in a victim impact statement at Wednesday’s sentencing.
“The consequences of his actions go beyond the monetary loss — he has disrupted lives, fractured trust, and placed an undue burden on an already struggling community,” Engle said.
The sentence Villarreal received is light compared to what he was facing — up to 10 years in prison for the federal theft charge, and up to 20 years in prison for each wire fraud charge, according to the U.S. Attorney’s Office (USAO). However, it was the maximum sentence based on a recommendation from the U.S. sentencing commission, which took into account several factors including the amount embezzled, the fact that Villarreal had no criminal history and more.
Villarreal used several methods to defraud the small district where he was employed — including using ISD credit cards to make personal purchases totaling over $100,000, issuing unauthorized checks from ISD accounts to himself totaling over $10,000, and issuing unauthorized checks to cover personal expenses owed to a credit card company totaling over $20,000. He also generated fraudulent payments to current and former employees for work that had not occurred and routed the payments to his own personal bank account. The total loss to Valentine ISD was $314,497.
Villarreal used the ill-gotten funds for hundreds of personal purchases, including travel, lodging, home improvements, hardware store purchases, personal cell phone bills, fuel, oil changes, convenience store purchases, Airbnb rentals, personal flight purchases, and various other unauthorized purchases.
In Engle’s victim impact statement — which she provided to The Big Bend Sentinel — she explained to the court that Villarreal’s actions have had a “deep and lasting” cultural, as well as financial, impact on the community of Valentine.
“This breach of trust extends far beyond a financial loss — it is a betrayal that has damaged relationships and eroded the community’s confidence in the integrity of the district’s leadership,” Engle said. “Teachers, staff, administrators, and parents who had trusted the district’s leadership are now grappling with feelings of anger and frustration.”
She testified that the stolen funds have decreased resources available to students, teachers and families in a majority low socioeconomic district. “The stolen funds were supposed to enrich the educational opportunities for students, provide necessary resources for teachers, and maintain school facilities,” Engle said.
In a follow up with The Sentinel, Engle said the district is pleased that the judge went with the maximum recommended sentence and that Villarreal’s restitution payments will be used to address the district’s various financial needs. “As the money comes in, it will be used to address the needs at the time,” Engle said. “We hope to use it to improve some of our student opportunities and programs.”
Villarreal has been out on bond since September 2024. His attorney Shane O’Neal said because he has done well on bond he will self surrender at the direction of the Bureau of Prisons between 30 and 60 days from the sentencing.
O’Neal said Villarreal “realized that he made mistakes.” “He took responsibility for that, knowing that it’s gonna cost him financially, it’s gonna cost his reputation, it’s gonna cost his future,” he said.
But O’Neal argued that proper supervision and typical financial controls were not in place at the district, which he hopes the community recognizes and works to prevent in the future.
“The unfortunate thing is that there’s a temptation here to say, ‘He’s bad. We’ve gotten rid of the bad apple’,” O’Neal said. “I think it would be valuable if the community stepped back a little bit and said, ‘In what ways can we have not put this temptation in front of somebody that we signed up for two jobs instead of having two people work in this office?’”
The FBI investigated the case with assistance from the Texas Rangers and the Department of Education Office of Inspector General. Assistant U.S. attorneys John Fedock, Scott Greenbaum and Chris Skillern prosecuted the case.
Editor’s note: an earlier version of this story has been updated to include input from Engle and O’Neal.