Head of Mexico's Teachers' Union Jailed, Accused of Stealing $160 Million

Elba Esther Gordillo, one of Mexico's most powerful women, was arrested Tuesday on charges of embezzling millions of dollars from the country's teachers union to pay for an opulent lifestyle.

The leader of the 1.5 million-member National Union of Education Workers, who is 68 years old, was arrested as she landed at the Toluca airport near Mexico City on a private flight from San Diego.

In a press conference minutes after her detention, Attorney General Jesus Murillo Karam said Gordillo is accused of embezzling 2 billion pesos (about $160 million) from union funds.

There is no one more loved by their people than I. I care about the teachers. This is a deep and serious dispute about public education.

— Elba Esther Gordillo, President of the National Union of Education Workers

Prosecutors said they had detected nearly $3 million in purchases at Neiman Marcus using union funds, as well as $17,000 in U.S. plastic surgery bills and the purchase of a million-dollar home in San Diego.

"We are looking at a case in which the funds of education workers have been illegally misused, for the benefit of several people, among them Elba Esther Gordillo," Murillo said.

Gordillo displayed her opulence openly with designer clothes and bags from places like Neiman Marcus, bodyguards, private planes, expensive cars and properties including a penthouse apartment in Mexico City's exclusive Polanco neighborhood. She has been widely lampooned for her many plastic surgeries and depicted in political cartoons as ghoulish.

Meanwhile, Mexico's teachers are poorly paid and public education has long been considered subpar.

The fall of one of the country's most storied and divisive characters — unthinkable just months ago — comes with the return to power of Mexico's Institutional Revolutionary Party, which previously ruled for 71 years and once helped Gordillo consolidate her power. She was arrested one day after President Enrique Peña Nieto signed into law a comprehensive education reform designed to dismantle a system she controlled.

Union members had been marching in the streets against the reform in recent weeks, and the fiery Gordillo, who rose from school teacher, vowed to keep fighting.

"I want to die with the epitaph: Here lies a warrior. She died like a warrior," Gordillo said in a speech on her 68th birthday earlier this month.

She has not spoken or appeared publicly since her arrest.

The investigation started in December, just after Peña Nieto took office, after Santander Bank alerted authorities to bank transfers in billions of pesos, according to the attorney general.

At the news conference, Murillo displayed a series of charts that resembled battle plans, with dozens arrows detailing the alleged flow of illicit transfers from teachers' union accounts to the personal accounts of three union workers who were not authorized to deal with finances, as well as a real estate company.

Some funds eventually ended up in bank accounts in Switzerland and Liechtenstein. Assistant Attorney General Alfredo Castillo said that in one case they transferred $1 million to a Swiss account for a company owned by Gordillo's mother. Those funds were then used to buy a million-dollar house in the island of Coronado in San Diego.

A television interview last week about education reform, the interviewer told Gordillo that she was the most hated woman in Mexico.

"There is no one more loved by their people than I," Gordillo answered. "I care about the teachers. This is a deep and serious dispute about public education."

The education reform signed into law this week creates a system of uniform standards for teacher hiring and promotion based on merit instead of union connections. It also allows for the first census of Mexico's education system, which Gordillo's union has largely controlled for decades, allegedly padding the payroll with thousands of phantom teachers.

So great is the union's control that no one knows exactly how many schools, teachers or students exist in Mexico.

For years, she has beaten back attacks from union dissidents, political foes and journalists who have seen her as a symbol of Mexico's corrupt, old-style politics. Rivals have accused her of corruption, misuse of union funds and even a murder, but prosecutors who investigated never brought a charge against her.

She was expelled from Peña Nieto's Institutional Revolutionary Party in 2006 for supporting other parties' candidates and the formation of her own New Alliance party. Her support was considered key in giving a razor-thin victory to former President Felipe Calderon.

Columnist and political analyst Raymundo Riva Palacio said Gordillo is an experienced political fighter who may have lost the keen sense of political calculation that kept her in power for so many years.

"She lost clarity," Riva Palacio said. "Having so much to lose on the issue on which they finally got her, the money, she calculated badly."

Gordillo's arrest recalled the 1989 arrest of another once-feared union boss, Joaquin Hernández Galicia, known as "La Quina." The longtime head of Mexico's powerful oil workers union, Hernandez Galicia was arrested during the first months of the new administration of then-President Carlos Salinas.

In 1988, he criticized Salinas' presidential candidacy and threatened an oil workers' strike if Salinas privatized any part of the government oil monopoly, Petroleos Mexicanos, or Pemex. On Jan. 10, 1989, — about a month after Salinas took office — soldiers used a bazooka to blow down the door of Hernandez' home in the Gulf Coast city of Ciudad Madero.

Like Gordillo, Hernandez Galicia's power was believed to represent a challenge to the president, and his arrest was interpreted as an assertion of the president's authority. He was freed from prison after Salinas left office.

Murillo denied that Gordillo's arrest was politically motivated and said it could not be compared to Hernandez's case.

"This was a very clear investigation and we will have more of them," he said.

Based on reporting by the Associated Press.

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