A former Sullivan City manager was indicted after allegedly pocketing more than $5,000 from the city while she oversaw its finances.

Ana Maria Mercado was indicted on March 26 on theft charges in connection with the investigation.

According to a criminal complaint obtained by Channel 5 News, the investigation started in October 2025 when current Sullivan City Manager Richard Ozuna flagged a suspicious payment from December 2022.

Records show Mercado issued herself a check for $25,000 to cover bands booked for the Sunset Fall Festival that year, although the total cost of the bands was $21,250.

The complaint says Mercado paid each band in cash on the day of the event, leaving $3,750 unaccounted for from the check she wrote to herself.

Investigators also found Mercado received $1,256 through the city's CashApp account after text messages showed Mercado directed a city employee to send the payment to her personal CashApp.

When questioned, Mercado said the extra money from the check went toward other festival expenses like fencing, signs, and drinks, but police say no records of those expenses exist.

Investigators say Mercado took a total of $5,006 that belonged to the city.

Mercado was initially arrested in connection with the investigation on Jan. 9, 2026, and released the following day on a $1,000 bond.

Hidalgo County court records indicate that a new arrest warrant was issued on Monday for Mercado on a charge of misapplication of fiduciary property.

Mercado is set to be arraigned in May.