A former South Lake Tahoe mayor whose church fraud case shocked residents in the scenic Sierra Nevada city pleaded guilty to wire fraud this week in federal court.
Tamara Le Ann Wallace, 56, had been working as a part-time bookkeeper for Lake Tahoe Community Presbyterian Church when she embezzled funds from the church’s bank account for personal use, taking so much from the church that it nearly caused the organization to shut down, according to the U.S. attorney’s office.
Wallace faces up to 20 years in federal prison and a $25,000 fine at her sentencing hearing in January.
Prosecutors allege Wallace embezzled about $390,000 from the church’s coffers between April 2019 and September 2025, spending some of the funds on rent and travel expenses. Wallace wrote reimbursement checks to herself, claiming they were repayments for expenses she never incurred. She also made electronic transfers into accounts she controlled and falsified financial entries in an effort to hide her tracks, according to prosecutors.
Wallace’s attorney and the Lake Tahoe Community Presbyterian Church did not immediately respond to requests for comment.
But, according to prosecutors, Wallace’s actions forced the church to scale back programming, take out loans and pay late fees and interest on overdue bills.
Wallace resigned from public office in October 2025 soon after she confessed in a letter to the Tahoe Daily Tribune that she had taken funds from the church. She wrote that the admission was “the hardest thing I have ever had to do” and said she had attempted suicide due to guilt and shame.
It wasn’t the first time Wallace has faced legal troubles, according to El Dorado County court records.
Federal Insurance Company, now a subsidiary of global insurance company Chubb, sued Wallace in 2006 and 2021. Records reviewed by The Times did not detail why Wallace was sued. The documents showed that the company had discovered a “theft of funds” in April 2006 and the former mayor agreed to repay $110,834. The law firm that filed the suit on behalf of the insurance company handles workers’ compensation cases, a representative said.
As a result of the suit, Wallace was required to pay $200 a month to the insurance company, according to a promissory note reviewed by The Times. But she allegedly fell behind in the payments, prompting the company to sue her again, according to court records.
In 2022, she agreed to make an initial payment of $2,500 by June 1 and then $400 monthly to the company until the amount was paid off.
Staff writer Hannah Fry contributed to this report
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