Former South Lake Tahoe Mayor Tamara Le Ann Wallace, 56, pleaded guilty to federal wire fraud on Oct. 29, 2026, after embezzling approximately $390,000 from Lake Tahoe Community Presbyterian Church, where she worked as a part-time bookkeeper.
Federal prosecutors said the theft nearly forced the church to close.
Wallace publicly acknowledged taking money from the congregation in October 2025 while she was still serving as mayor.
She resigned from South Lake Tahoe’s City Council later that month.
False Reimbursements Included a $7,500 Check Marked “Reimb”
Wallace began working for the church in 2018, handling bills, budgets and financial records. According to the U.S. Attorney’s Office, she could access its bank account and was the only person with access to its digital accounting system for most of her employment.
From April 2019 through September 2025, Wallace issued checks to herself totaling approximately $360,000, presenting them in the records as reimbursements for church expenses she had never paid. The federal charging information identified a $7,500 check she wrote to herself on Sept. 5, 2025, with the bookkeeping description “Reimb,” according to South Tahoe Now’s examination of the filing.
She also made roughly $31,000 in unauthorized electronic transfers into accounts she controlled. Wallace entered false information into the church’s financial records to conceal the withdrawals, and prosecutors said she used the stolen money for personal expenses including housing and travel.
The Church Borrowed Money and Reduced Programs to Stay Open
According to federal prosecutors, the missing money put severe pressure on Lake Tahoe Community Presbyterian Church’s finances. The congregation cut programs, took out multiple loans to cover expenses and incurred late fees and interest on bills it could not pay on time.
The City of South Lake Tahoe said the misconduct involved Wallace’s private employment and had not affected municipal funds or finances.
Church Says It Discovered the Theft Before Wallace’s Public Confession
In an October 2025 public letter, Wallace acknowledged taking money from the church and promised to repay it. She maintained that the congregation had not discovered the theft before her disclosure and described giving church officials account information to help uncover the transactions.
The church’s governing board gave a different account, saying it had discovered the misconduct, terminated Wallace’s employment on Sept. 26, 2025, and referred the matter to law enforcement. The board also said Wallace was an employee, not a member of the congregation.
Church attorney Philip Dunn subsequently told South Tahoe Now that Wallace had not reported the theft to the church. Wallace resigned from the mayor’s office and City Council on Oct. 13, 2025, with her resignation taking effect immediately.
Earlier Civil Lawsuits Involved a Separate Insurance Repayment Dispute
A San Francisco Chronicle investigation in October 2025 identified civil lawsuits against Wallace brought by Federal Insurance Company in 2006 and 2021. According to the records examined by the newspaper, the insurer had paid $122,193.16 in connection with a separately reported theft of funds, and Wallace signed a note agreeing to reimburse it.
Federal Insurance sued again after Wallace stopped making payments under the original agreement, alleging that more than $110,000 remained unpaid. A judgment was entered in 2022, and Wallace agreed to a revised repayment arrangement. The civil dispute was separate from the church embezzlement and was not part of her federal wire-fraud prosecution.
Guilty Plea Sets Up January 14 Sentencing
Federal prosecutors charged Wallace by criminal information in September 2026, and she waived a grand-jury indictment. She initially pleaded not guilty at her Oct. 13 arraignment before U.S. Magistrate Judge Carolyn K. Delaney, then changed her plea on Oct. 29 before Chief U.S. District Judge Troy L. Nunley.
Asked by Judge Nunley whether she was entering the plea agreement because she was guilty, Wallace answered, “I am,” according to South Tahoe Now’s courtroom report. The federal court docket records her guilty plea to the single count in case 2:26-cr-00163.
Wallace faces a statutory maximum of 20 years in federal prison and a $250,000 fine. Sentencing is scheduled for Jan. 14, 2027, at 9:30 a.m. The docket entry for her Oct. 29 plea agreement directs prosecutors to provide a victim restitution spreadsheet to the probation office within 14 days. South Tahoe Now reported a possible restitution range of $380,000 to $500,000. The court has not yet ordered a final amount.