The former leader of Mexico's powerful SNTE teachers union is being prosecuted for tax fraud, Mexican judicial officials said.

Elba Esther Gordillo, who is being held at a Mexico City prison, will go to trial "for her probable responsibility in the commission of tax fraud," the Federal Judiciary Council, or CJF, said.

A criminal court in the Federal District issued a ruling Friday against Gordillo, who will remain in prison pending trial, the CJF said in a statement.

"The court determined that the law gives each of the parties three working days, effective as of the day after notification of the decision, to file appeals," the CJF said.

Gordillo pleaded not guilty during a hearing at the prison in the southern part of Mexico City on Thursday.

The former union boss faces tax, criminal conspiracy and money laundering charges, the federal Attorney General's Office said.

A federal judge opened the way for the former SNTE president's prosecution for tax fraud last Tuesday, the AG's office said.

The allegation "is based on evidence that shows that Gordillo Morales declared income on her 2008 income tax return that was substantially less than the actual amount," the AG's office said in a statement.

Gordillo, who ran the SNTE for more than two decades, was arrested on Feb. 26 on a warrant issued by a judge at the request of the federal AG's office.

Prosecutors allege that Gordillo, who was considered the most powerful woman in Mexico, used union funds to pay personal expenses.

Gordillo, once described by scholar M. Delal Baer as "Jimmy Hoffa in a dress," used union funds to pay credit card bills, make purchases at luxury stores, have cosmetic surgery, purchase real estate and cover other spending, prosecutors allege.

The former union boss was expelled from the governing Institutional Revolutionary Party, or PRI, in 2006 for helping create the New Alliance Party, or PANAL, which tried unsuccessfully to form a coalition with Enrique Peña Nieto, who won last year's presidential election.

Prosecutors allege that Gordillo embezzled more than 2 billion pesos ($152 million) in union funds.

Gordillo was arrested a day after Peña Nieto announced education reforms opposed by the SNTE, which has some 1.2 million members and is Latin America's largest union. EFE