Elba Esther Gordillo, known for flashing her Hermes handbags and heels, stood behind bars Wednesday in a grim prison in eastern Mexico City as a judge read off charges of embezzlement and organized crime.
The head of Mexico's national teachers union was arrested Tuesday after returning from San Diego.
Mexican prosecutors say the country's most powerful union boss used some of an estimated $160 million in embezzled funds for property in Coronado.
Company that prosecutors say was registered to her dead mother's estate owns two homes in Coronado. A modern six-bedroom home with a three-car garage was purchased in 1991 for $1.15 million and is assessed at $4.72 million. A boat was docked behind the house Wednesday.
The company owns another property across the street that was purchased in 2010 and is assessed at $4.08 million. The wooden frame of a house sits on the property.
Prosecutors said she spent nearly $3 million in purchases at Neiman Marcus department stores using union funds, as well as $17,000 in U.S. plastic surgery bills.
The arrest sidelined a woman who had tried to mobilize teachers to block a schools shake-up designed to end her control over hiring and firing of teachers across the country.
It also sent a message to other union bosses and business magnates: Don't get in the way of Enrique Pena Nieto, whose Institutional Revolutionary Party has newly returned to the power it held for seven straight decades, when incoming presidents often crushed those who challenged them.
"This is an old tactic, let's hope that it doesn't just stop there, as it did in the past, when a single case was enough to calm things down and add legitimacy" to presidential power, said Jose Antonio Crespo, an analyst at the Center for Economic Studies. "Let's hope this doesn't stop and that it becomes something more systematic, for which there is a burning need."
Crespo was referring to the business magnates and union bosses who have built fortunes and political power by dominating whole sectors of the economy.
Like Gordillo, their resistance could be an obstacle to Pena Nieto's pledges to modernize and open up Mexico's economy.
But the tough message of Tuesday's arrest may have been enough.
Gordillo, whose 1.5 million-member National Union of Education Workers organized protests against Pena Nieto's education reform signed into law this week, is being held in Mexico City's women's prison.
It was a dizzying fall from power for a woman often credited with swinging a presidential election.
Pena Nieto went on television Tuesday night to say the case was strictly based on enforcing the rule of law.
"This investigation has to be pursued to the very end but always adhering to the rule of law," he said, without referring to Gordillo by name.
The president also spoke directly to the millions of teachers in the two-minute national broadcast, saying his government will support them and respect the union's autonomy.
"My government will continue to be your ally and will continue to work to improve the conditions in which you carry the high mission of educating tomorrow's citizens," he said.
There is a sense that "this is a message to all the other corrupt leaders," said Humberto Castillo, a 55-year-old retired teacher from Mexico State, who was reading a newspaper story about Gordillo's arrest while he waited for his daughter to come out of a job interview. "I thought she was untouchable."
The judge in the case said he would rule in three to six days on whether the evidence is sufficient to merit a trial.
If found guilty, Gordillo could face 30 years in prison.